Consent Decree; Notice of Proposed Settlement and Hearing; Joint Motion for Approval and for Hearing; Findings of Fact

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INTTHE 

  

UNITED. STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF INDIANA 

HAMMOND DIVISION 

BERNICE TERRY, ET: AlL., 

Plaintiffs 

VS. Cause No. H 76-373 

METHODIST HOSPITAL OF GARY, INC. 

An Indiana Not For Profit 
Corporation, and JOSEPH CALIFANO, 
as United States Secretary of 
Health, Education and Welfare, 

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Defendants 

RICHARD GORDON HATCHER, 

WILLIE LEE PAGE, 

METRO CORPS OF GARY, INC. 

A Not-For-Profit Corporation 
and others similarly situated, 

Plaintiffs 

VS. Cause No. H 77-154 

METHODIST HOSPITAL OF GARY, INC., 

An Indiana Not-For-Profit 
Corporation and DENIS E. RIBORDY, 
as President of the Board of 

Directors, 

JOSEPH CALIFANO, as United States 

Secretary of Health, Education 
and Welfare, 

WILLIAM T. PAYNTER, M.D., as 

State Health Commissioner for the 

Indiana State Board of Health, 

JANES WHITE, as Director of the 
Division of Hospital and 
Ingtitutional Services of the 
Indiana State Board of Health, 

DAVID J. EDWARDS, M.D., as 

Director of the Health Pacilities, 
Services and Review Development 

Bureau of the Indiana State Board 

of Health, 

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Defendants 

CONSINT DECRER   

HISTORY OF THE LITIGATION   

On approximately December 29, 1976, four black citizens 

Cf Gary, Indiana, Barbara Lesk Wesson, Bernice Terry, Rosa 

  

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Keeton and Eddie Gray, filed a Complaint and a Motion for 

Preliminary Injunction in the United States District Court 

for the Northern District of Indiana, Hammond Division, 

on behalf of themselves and others similarly situated, against 

the defendants, Methodist Hospital of Gary, Inc. and Joseph 

Califano, as United States Secretary of Health, Education 

and Welfare, which cause was docketed as H 76-373. On approxi- 

mately June 10, 1977, an Amended Complaint was filed in 

this action in which, inter alia, Barbara Wesson, Rosa Keeton 

and Eddie Gray withdrew as named plaintiffs. 

On approximately May 6, 1977, a new Complaint was filed 

wherein Richard Gordon Hatcher, Willie Lee Page and Metro 

Corps of Gary, Inc. on behalf of themselves and others similarly 

situated were plaintiffs and Methodist Hospital of Gary, 

inc., and Denis E,. Ribordy, as President of the Board of 

Directors of Methodist Hospital of Gary, Inc., (hereinafter 

collectively referred to as "Methodist Hospital"), Joseph 

Califano, as United States Secretary of Health, Education 

and Welfare, (hereinafter referred to as "HEW"), William 

T. Paynter, M.D., as State Health Commissioner for the Indiana 

State Board of Health, James White, as Director of the Division 

of Hospital and Institutional Services of the Indiana State 

Board of Health, David J. Edwards, M.D., as Director of 

the Health Facilities Services and Review Development Bureau 

of the Indiana State Board of Health, (hereinafter collectively 

referred to as "State of Indiana”), and Kipton Kaplan, Executive 

Director of the Northern Indiana Health Systems Agency, 

Inc. were named as defendants. This cause was docketed 

as. .H 77-154 in the United States District Court for the 

Northern District of Indiana, Hammond Division. 

  

 



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In these actions, black residents of Gary, Indiana, 

  

and a non-profit corporation alleged the existence, perpetuation 

and expansion of racially segregated and discriminatory 

hospital facilities operated by Methodist Hospital of Gary, 

Inc., and the illegal approval and granting of federal financial 

assistance to Methodist Hospital for said facilities by 

defendant federal and state officials. Plaintiffs sought 

declaratory and injunctive relief against defendants alleging 

default of obligations under the following statutes and 

their implementing regulations: the Fifth and Four teenth 

Amendments to the United States Constitution; the Civil 

Rights Act of 1871, specifically 42 U.S.C. §1983; Title 

VI of the Civil Rights Act of 1964, 42 U.S.C. §2000d et 

seq.; Title VI of the Public Health Services Act, 42 U.S.C. 

§291; Title XVI of the Public Health Services ACL ,.-42 UV.5.C. 

$3000 et seq.7 $314 of the Public Health Services Act, 42 

U.S.C. §245; Title XV of the National Health Planning and 

Resources Development Act of 1974, Public Law 93-641, codified 

at 42:U.8.C. 8§300k et Sed.; $1122 of the Social Security 

ACt, as amended, 1972, 42 U.8.C. §1302a-1; and, 5504 of 

the Rehabilitation Act, as amended, 1973, 29 U.S.C. §704. 

Jurisdiction was alleged under 28 U.S.C. $1331, 1343 and 

1361 ang 23 U.S5.C. $2201 and 2202. 

The defendants have denied the allegations of the plaintiffs’ 

Complaints and disputed the jurisdiction of this Court. 

Additionally, Methodist Hospital denies plaintiffs’ right 

or standing to bring such causes of action. 

On the 6th day of July, 1977, the two cases were con- 

solidated by Order of Court and on the 7th day of December, 

1877, the District Court by its Order conditionally certified 

sald actions as class actions on behalf of all of the Black 

residents of the City of Gary, Indiana, pursuant to Federal 

Rule of Civil Procedure 23(b) (2). 

  

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The Court's Order of December 1, 1977, additionally 

granted the Motion to Dismiss of defendant Kipton Kaplan. 

On the 13th day of January, 1978, the Court severed 

the plaintiffs' allegations with respect to. the "national 

causes of action” limited only to defendant HEW. The remaining 

provisions of this Consent Decree accordingly do not involve 

nor apply to the aforesaid "national causes of action’ in 

these matters. 

The defendant, Methodist Hospital, filed a Motion to 

Dismiss in each case prior to consolidation. The Motions 

were denied without opinion by this Court in an Order dated 

January 30, 1978. These matters were then raised by Methodist 

Hospital in their Answers to the Complaints as affirmative 

defenses which are still pending before the Court and have 

not as yet been ruled upon. 

In August of 1977, defendant HEW initiated a civil 

rights review of all hospitals in Lake County, Indiana including 

the defendant, Methodist Hospital, The defendant HEW placed 

a moratorium on all hospital construction in Lake County, 

including Methodist Hospital until such time as a civil 

rights review was completed. Certain exceptions to this 

moratorium were made but no exception was made in the case 

of Broadway Methodist Hospital. 

A Pre-Trial Conference was held on the 21st day of 

February, 1978, at which time the plaintiffs voluntarily 

dismissed the allegations of their Complaints with respect 

to §504 of the Rehabilitation Act as amended in 1973, 29 

U.5.C. §794. A Pre-Trial Order has been prepared and forwarded 

to the Court by the attorneys for the parties which has 

not bcen formally signed by all the attorneys for the parties 

or. entered by ‘the Court. 

    

 



ENTRY OF CONSENT DECREE 

  

  

The plaintiffs and the class they represent maintain 

the validity of the claims in their Complaints that defendants 

and each of them violated, failed to comply with and/or 

enforce Title VI-of the Civil Rights Act of 1964, the Fifth 

and Fourteenth Amendments to the United States Constitution 

and/or other civil rights laws, regulations, affirmative 

action agreements or programs or assurances and do not by 

agreeing to the entry of and the terms of this Decree in 

any way alter their position that the allegations of the 

Complaints are true and that defendants and each of them 

would be subject to liability under the Complaints. The 

plaintiffs maintain that defendants and each of them would 

have continued to fail to comply with the provisions of 

Title VI and the Constitutions and other laws of the United 

States of America and the State of Indiana. 

The defendants, Methodist Hospital and State of Indiana, 

and each of them deny any violation of, failure to comply 

with Or fallure £0 enforce Title VI of ‘the Civil Rights 

Act of 1564, provisions of the United States Constitution, 

Or ‘of any other civil rights law, regulation, affirmative 

action agreement or program or assurance. HEW denies any 

failure to enforce Title VI of the Civil Rights Act of 1964, 

provisions of the United States Constitution, or of any 

Other civil rights law, regulation, affirmative action agreement 

Or program or assurance. The defendants and each of them 

do not by agreeing to the entry of and the terms of this 

Decree admit to any such allegations of the Complaints or 

to any liability whatever. The defendants and each of them 

    
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maintain that they have complied with and will continue 

to comply with the provisions of Title VI and the Constitutions 

and other Jaws of the United States of America and the State 

of Indiana. 

However, the plaintiffs, the class of all black residents 

of Gary, Indiana, Methodist Hospital, HEW and the State 

of Indiana have consented to the entry of this Consent Decree 

to resolve these actions and all issues properly before 

the Court, without the additional time and expense Of contested 

litigation. Plaintiffs, the affected class, Methodist Hospital, 

HEW, and the State of Indiana have waived entry of Findings 

of Fact and Conclusions of Law but agree that this Decree 

shall be binding in all respects. It is the parties intent 

to resolve by this Decree all allegations which are or were 

the basis or bases and which properly are within the scope 

of these Complaints or this Decree with the exception of 

plaintiffs’ allegations of "national causes of action" limited 

to defendant HEW and plaintiffs' allegations of "statewide 

causes of action" limited to defendant State of Indiana. 

The parties to these actions and their respective counsel 

have met and discussed the settlement of these actions and 

the terms and provisions of ‘this Decree and each ‘and all 

Of them do consent to the entry of this Decree as =z. final 

and binding settlement in full disposition of any and all 

claims by the plaintiffs against the defendants jointly 

and severally with respect to any and all acts and practices 

of alleged civil rights discrimination properly within the 

scope of the Complaints or this Decree except as to the 

"national causes of action” and the “statewide causes of 

action" described in the last preceding paragraph. 

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The Court has examined carefully the terms and provisions 

of this Decree and finds that they are fair, reasonable 

and just, that the rights of the affected class and each 

member thereof are protected adequately by this Decree, 

that this Decree is in conformity with the Fifth and Fourteenth 

Amendments to the United States Constitution; the Civil 

Rights Act of 1871, specifically 42 U.S.C. $1983; Title 

VIi.of the Civil Rights Act of 1964, 42 U.5.C. £20084 et 

Seqg.: Title VI of the Public Health Services Act, 42 U.S.C. 

$291; Title XVI of the Public Health Services Act, 42 U.S.C. 

$3000 et seq.; §314 of the. Public Health Services Act, 42 

U.8.C. 8246: Title XV of the National Health Planning and 

Resources Development Act of 1974, Public Law 93-641, codified 

at 42 U.5.C. $300k et seq.; 51122 of the Social Security 

Act, ‘as amended, 1972, 42 U.S.C. §1302a-1: $504 of the Rehabili- 

tation Act, as amended, 1973, 29 U.S.C. §794; and, the Federal 

Rules of Civil Procedure, and ‘that this Decree is not in 

deprivation of rights and privileges of any person in violation 

of said Rules, Amendments and statutes. 

It likewise appears to the Court that entry of this 

Pecree will further the objectives of Title VI of the Civil 

Rights Act of 1964, and the aforesaid Rules, Amendments 

and statutes, that this Decree protects adequately the rights 

Of the affected class and is in the interest of the plaintiffs, 

the class members, Methodist Hospital, State of Indiana, 

and the general public. 

NOW, THEREFORE, IT IS ORDERED, ADJUDGED AND DECREED 

as follows: 

A, GENERAL PROVISIONS. 
  

l. This Court has jurisdiction of the parties hereto. 

    

 



2. Neither the agreement to entry of this Decree nor 

  

anything in this Decree shall be construed to be or shall 

be admissible in any proceeding as evidence of an admission 

by the defendants or any of them of any violation of or 

a fallure to comply with or enforce Title VI of the Civil 

Rights Act of 1964, as amended, or any other civil rights 

law, order or regulation or assurance or of any failure 

to comply with any provision of any affirmative action agree- 

ment, assurance or prodram to or in which any one or all 

of the defendants may be a party or engaged. 

3. This Decree settles the interests and claims of 

the parties and members of the affected class against the 

defendants, which are within the scope of the Complaints 

Or Decree, particularly any and all acts and practices of 

alleged civil rights discrimination at the respective facilities 

of Methodist Hospital to the date of the entry of the Decree 

including the affects of the same whether past, present 

or future except plaintiffs' allegations of "national causes 

of action" limited to defendant HEW and sinihh Loss: allegations 

of "statewide causes of action” limited to defendant State 

of Indiana. The doctrines of res judicata and collateral 

estoppel shall apply to all plaintiffs and members of the 

affected class with respect to all issues of law and fact 

properly within the scope of the Complaints or the Decree. 

No other actions by the plaintiffs or any members of the 

affected class shall be brought against Methodist Hospital, 

HEW or the State of Indiana with respect to such claims, 

rights or causes of action in any form, administrative or 

judicial. The foregoing, however, shall not apply to allegedly 

discriminatory ‘acts occurring after the date of this Decree 

and to any acts not within the scope of the Complaints or 

  

 



this Decree, excepting those acts which are specifically 

  

required in satisfaction and in performance of Methodist 

Hospital's obligations under this Decree. 

4. The Department of HEW shall not institute, prosecute 

or support as a party or as an amicus curiae any action 

involving Methodist Hospital, administrative or otherwise, 

based upon any violation of Title VI of the Civil Rights 

Act of 1964, as amended, which has been alleged or is within 

the scope of the Complaints herein and to which this Decree 

1s directed. It is recognized by the parties that HEW is 

conducting a civil rights review of hospitals in Lake 

County, Indiana, and HEW by joining in this Decree is not 

precluded from requiring commitments and resources from 

lethodist Hospital in addition to those included in this 

Decree, that it requires of all other hospitals in Lake 

County, Indiana and joint planning it requires of any other 

hospitals in Lake County, Indiana including commitments 

and resources pursuant thereto. HEW is not precluded from 

making further civil rights reviews of Methodist Hospital 

concerning acts occurring after the date of this Decree 

except that no violation will be found resulting from those 

acts which are specifically required in satisfaction and 

in performance of Methodist Hospital's obligations under 

this Decree. 

5. Should the implementation of any specific provision 

of this Decree thereafter be determined by a federal court 

or a federal agency to be illegal under federal law, the 

parties may apply to this Court upon appropriate application 

and notice to all attorneys of record to suspend or modify 

the specific provision at issue to conform to the subsequent 

Court determination, or to resolve any legal inconsistency 

between such federal agency's determination and the provisions 

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Of this Decree. The terms and conditions of this Decree 

may be subject to further modification as a result of Joint 

planning referred to in paragraph A-4 above or as otherwise 

required by appropriate authorities with binding jurisdiction 

over the hospital upon appropriate application and notice 

to the attorneys of record. In the event any such suspension 

or modification is determined by this Court to be necessary, 

to the greatest feasible extent the initial purpose of the 

provisions shall be maintained. Such suspension or modification 

unless involving a prohibition to build the 105 bed expansion 

at the Broadway site shall not affect the remainder of this 

Decree. A denial or approval of amendment of the Indiana 

State Medical Facilities Plan and/or a denial of §1122 approval 

shall not constitute a prohibition to build the 105 bed 

expansion. 

6, The keeping of records by race for purposes of 

compliance with this Decree shall not constitute a violation 

of any statute, regulation or law. 

7. The Civil Rights Assurances signed by Methodist 

Hospital on July 27, 1973, as modified herein, are incorporated 

herein, and attached hereto as "Exhibit C". Any inconsistencies 

between this Decree and the Assurances are to be resolved 

in favor of the Decree. Compliance with this Decree will 

be deemed to be compliance with the Assurances and in particular 

with Assurance No. 3 and no further approvals are required 

for the projects hereinafter listed in paragraph B 1 and 

2 in order to comply with the said 1973 Civil Rights Assurances. 

B. OBLIGATIONS OF METHODIST HOSPITAL. 
  

l. Methodist Hospital shall implement a building and 

improvement program at its Gary facility providing for the 

following: 

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a. Installaticn of a reception room and elevator 

  

on the east side of the hospital structure leading 

to the area designated as 4 North and remodeling of 

said 4 North area or provision of some other suitable 

location as approved by the American Academy of Family 

Practice to house a Family Practice Residency Program. 

b. A Medical Services Building to be located 

on the west side of the hospital structure to contain 

the following: 

l. A new surgical suite containing four 

(4) operating rooms plus one (1) cystoscopy room 

and one (l) outpatient surgical room, a recovery 

room containing six (6) to eight (8) beds and 

a special procedures x-ray room; 

2. A new intensive care and coronary care 

unit with an aggregate of twelve (12) beds; 

3. A new central supply department; 

4. The emergency room will be relocated 

into this building and either ambulatory care 

clinics and services or nuclear medicine will 

be relocated in the present emergency room; 

5. This building will be built so that it 

will not preclude expansion horizontally by 10,000 

square feet. 

C. An outpatient pharmacy providing twenty-four 

(24) hour service to the citizens of Gary and vicinity 

which shall be located in the Medical Services Building 

orsadjacent toor in. the hospital. 

d. A sufficient power plant to service the additional 

facilities described herein. Methodist Hospital shall 

provide, as needed, additional power to serve added 

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facilities at Gary Methodist Hospital listed in the 

  

approved and/or modified long range plan and it shall 

not fail to build such facilities because of lack of 

adequate power facilities at the Gary hospital. 

e. Refurbishing of the Labor and Obstetrics Depart- 

ment including: 

l. Setting up a new nursery at the site 

of one of the existing nurseries with new equipment, 

where necessary, including, but not limited to, oxygen, 

suction and ventilation; 

2. Providing new beds and tables in the 

general Obstetrics area and blocking up of the 

windows in the general Obstetrics area. 

£. . In order to bring the hospital into compliance 

with the 1973 Life Safety Code as determined by the 

review of the Regional Office Facilities, Engineering 

and Construction (ROFEC) of Region V of the Department 

of Health, Education and Welfare dated March 3, 978, 

and to meet the review of the Joint Conntiiion for 

Accreditation of Hospitals dated the 22nd of August, 

1977, the hospital will make the improvements, physical 

alterations and additions set out on the attached list 

marked "Exhibit A". The ventilation referred to in 

the ROFEC report but not listed on the attached "Exhibit A" 

will not be required. No federal funds will be used 

to accomplish the work described in this subparagraph. 

g. Remodeling of the South Pavilion Cafeteria 

into an Auditorium. 

h. With the advice of a special consultant, Methodist 

Hospital will provide secure parking for doctors, employees 

and visitors. 

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i. An Intermediate Cardiac Care Unit with telemetry 

  

and a Stress Testing and Cardiac Rehabilitation Laboratories 

will be established. 

J. A laundry sufficient to service the Broadway 

and Gary facilities. It is understood and agreed that 

Mayor Hatcher shall recommend to the Gary Redevelopment 

Commission that it shall, if necessary, secure for 

the hospital two (2) to three (3) acres of land in 

the City Of Gary for said laundry at no cost to the 

Hospital. 

kK. An area of the hospital will be remodeled 

for the Ambulatory Care Clinics and Services. 

2. Methodist Hospital shall implement a building and 

improvement program at its Broadway facility providing for 

the following: 

a. A new Health Services Building at Broadway 

will be constructed under plans previously submitted 

to HEW under Project No. 213, copies of which are attached 

hereto and marked "Exhibit B" including descriptions. 

The Health Services Building will only include those 

services and programs listed in "Exhibit B". New equip- 

ment and services for nuclear medicine and new programs 

and services not listed in "Exhibit B" are subject 

to provisions B 7 (c) and B 17 of this Decree. It 

is understood that the inclusion in "Exhibit B" of 

plans for a laundry at Broadway does not allow for 

the implementation of the plans for a laundry at Broadway 

and does not affect the hospital's obligations under 

paragraph B=-1"j of this Decree. 

pb. A one hundred five (1053) bed addition. 

3. The location and exact parameters of the programs 

described in the foregoing paragraphs one (1) and two (2) 

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are subject to adjustment, with the advice and consent of 

the parties hereto, as dictated by architectural necessity, 

4. The Family Practice Residency Program will be available 

to enrolled families and will provide medical care in a 

manner not inconsistent with the accreditation standards 

provided for by the Academy of Family Practice. Medical 

service will be available to enrolled families when needed. 

5. The building program at Broadway cannot commence 

until the building program at Gary has commenced and the 

building program at Gary cannot commence until the entire 

building program at Broadway, including particularly but 

not limited to the one hundred five (105) beds, is ready 

to commence. Lack of a denial or approval to amend the 

Indiana State Medical Facilities Plan concerning the 105 

bed addition and/or a denial of §1122 approval concerning 

the 105 bed addition shall not affect the commencement of 

the building programs. Any failure by the defendant, Methodist 

Hospital, to expeditiously complete the building program 

at the Gary facility will be a violation of this Dacreo 

and will require the immediate termination of all building 

programs at Broadway unless such failure to expeditiously 

complete is caused by unforeseeable cause beyond the control 

and without the fault or negligence of the hospital including 

put not restricted to acts of God, of the public enemy, 

acts of the contractor or subcontractors in the performance 

Of a contract with the hospital, fires, £loods, epidemics, 

quarantine restrictions, strikes, freight embargoes and 

severe weather. 

6. Not later than thirty (30) days after receipt of 

the necessary approvals by HEW and the State .of Indiana, 

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the Methodist Hospital shall supply plaintiffs and HEW with 

  

a construction starting date and an estimate of the time 

required for the completion of all construction to be per formed 

pursuant to this Decree. 

7. The hospital shall maintain the Gary facility's 

Occupancy rate at an efficient level and pursuant thereto 

will undertake the following: 

a. Patients and doctors applying for admission 

of patients to the Broadway facility will be strongly 

urged to go to the Gary facility rather than to be 

Placed on a walting list at the Broadway facility. 

b. Efforts to further integrate the staffs and 

patient census at both sites will be maintained and 

intensified. The hospital will keep records of what 

efforts it makes to achieve this goal. 

c. When the hospital contemplates adding new 

services such services will be placed at Gary unless 

such placement is inconsistent with good hospital manage- 

ment principles. For the purposes of this subparagraph, 

when the determination as to what constitutes good 

hospital management principles is made, economic factors 

will not be considered. 

8. The hospital shall continue to provide services 

to patients who appear at the emergency room at the Gary 

facility. The hospital shall provide adequate and comparable 

doctors' coverage at the Emergency Room at both facilities 

which shall include specialists available for consultation 

and doctors available for referral and admission purposes. 

The hospital shall ensure that doctors practicing at both 

facilities shall be able to secure specialist consultations 

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with doctors on the Methodist Hospital Staff. To achieve 

this goal, the hospital will, in addition, make every reasonable 

effort to ensure that all doctors on the’ hospital ‘staff 

take emergency room calls at both facilities. 

9. The hospital shall ensure that all nursing shifts 

are adequately and comparably covered at both sites without 

excessive overtime. 

10. The hospital will make reasonable good faith efforts 

to obtain residencies at the Gary facility in Internal Medicine 

and Obstetrics and Gynecology. This paragraph shall not 

be construed to allow two separate residency programs in 

the same specialty at both facilities. 

11. All medical education of staff and patients at 

the Broadway facility will be comparably provided at the 

Gary facility. 

12. Ambulatory care services will be expanded at the 

Gary facility to provide well staffed services on a frequent 

basis. Tertiary (specialty) ambulatory care services may 

be expanded at the Gary facility. All such services shall 

be ler the exclusive control and direction of Methodist 

Hospital. 

13. Primary health care services will be available 

to patients in need of health care through the auspices 

of the Family Practice Residency program. Patients requiring 

primary health care services and not enrolled in the Family 

Practice Residency program whether by choice or due to the 

limitations of the Family Practice Residency program will 

be seen by a faculty physician or other qualified personnel 

associated with the Family Practice Residency program. 

Thus, primary health care will be available to the community 

immediately upon the establishment of the Family Practice 

Residency program. Through the Family Practice Residency 

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program the hospital will exert efforts to cricourage physicians 

upon completion of their Family Practice Residency to establish 

a primary care practice in the community. 

14. Methodist Hospital will devise and implement an 

outreach program to foster utilization by the residents 

Of Gary of the Family Practice Residency program and the 

primary care services available through the auspices of 

that program and to foster utilization of ambulatory care 

clinics at the Gary Facility, 

15. Qualified staff shall be assigned to operate the 

Orthovoltage X-Ray Machine at Gary at least two (2) afternoons 

per week. If after six (6) months the hospital can demonstrate 

to HEW's Office for Civil Rights of Region V that the service 

is not feasible, then the hospital will be free to modify 

the schedule and if appropriate, terminate the use of this 

machine at the Gary facility. 

16. Except as otherwise provided for herein, Methodist 

Hospital hereby agrees that it will neither create any new 

clinics at its Broadway facility which would duplicate clinics 

at the Gary facility nor will it create any other new clinics 0 

at the Broadway facility unless it is demonstrated to HEW's 

Office for Civil Rights of Region V that there is a need 

for such clinic for the population served by the Broadway 

facility and that there are adequate hours and staffing 

at the clinics at the Gary facility. This shall not preclude 

Methodist Hospital from allowing physicians to treat their 

private patients for a given service at the Broadway facility 

without prior HEW approval if similar space is utilized 

by physicians at the Gary facility for patients for whom 

the Gary facility is more convenient. 

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17. All future purchases of equipment and construction 

not covercd by paragraphs B (1) and (2) hereof shall be 

made on an equitable basis between the two facilities. 

! Purchases of equipment and construction over $100,000.00 

shall be approved for civil rights purposes by HEW's Office 

for Civil Rights of Region V prior to purchase. HEW's Office 

for Civil Rights of Region V. will respond with approval, 

disapproval or reasons for additional time to respond within 

thirty (30) days after receipt of the request for approval. 

The requirement in this paragraph is in addition to the 

hospital's responsibilities under 42 U.S.C. §1320a-1 and 

Public Law 93-641. 

18. The hospital shall develop a long range plan for 

both hospitals which shall be submitted by December of 1978 

to the Office for Civil Rights of Region V and to the plaintiffs? 

attorneys of record for approval for civil rights matters 

as a long range plan. Any material deviation from that 

plan must be submitted to HEW's Office for Civil Rights 

of Region V for civil rights approval. HEW's Office for 

Civil Rights of Region V will respond with this approval, 

disapproval or reasons for additional time to respond within 

thirty (30) days of the request. This long range plan shall 

include but not be limited to the following: improvement, 

expansion, and modernization of the Laboratory Department 

at Gary; updating of the Radiology Department at Gary; upgrading 

and modernization of Pediatrics at Gary; ventilation of 

the Obstetrics Department at Gary; and central air conditioning 

of the following areas at Gary: Hayes Street Wing and Grant 

Street Wing. It is understood that in the preparation of 

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the long range plan, the projected date for installing the 

  

air conditioning referred to above shall take into account 

the hospital's building program pursuant to paragraph B- 

1 of this Decree and may be deferred accordingly. This 

plan will be subject to change as a result of joint planning 

referred to in paragraph A-4 of this Decree. The requirement 

in this paragraph is in addition to the hospital's responsibilities 

under 42 U.S.C. §$1320a-1 and Public Law 93-641. 

19. The hospital shall provide transportation service, 

as developed by an outside consultant between the Gary and 

Broadway facilities. This service shall be provided only 

to ambulatory patients and staff on their way . to or from 

work, and shall be provided at no charge. This transportation 

shall be available at reasonable intervals on a daily basis. 

Nn
 Methodist Hospital shall hire the consultant as soon as 

the construction schedules for the projects listed in paragraphs 

B.{1l) and (2) are established. The transportation system 

developed is subject to modification as a result of joint 

Planning referred to in paragraph A-4 of this Phorae. Methodist 

Hospital will participate in efforts to obtain public transpor- 

tation between Gary and Broadway. The parties agree that 

upon appropriate notice to and approval by HEW's Office 

for Civil Rights of Region V the requirements of this paragraph 

may be adjusted to reflect the availability of public transportation. 

20. The Board of Directors of Methodist Hospital of 

Gary, Inc. shall be restructured to ensure representation 

of members of minority groups in Gary and the minority group 

members in the patient populations at both the Gary and 

Broadway facilities and to that end at least one-third of 

the members of the Board of Directors shall be members of 

-19-— 

  

v 

 



minority groups. There shall also be representatives of 

  

the handicapped population on the Board. Such minority 

group representation shall be reflected on all Committe S 

Of the Board. Said restructuring shall be completed by 

the ‘end of 1981. At least one-third of all openings on 

the Board shall be filled to meet the requirements stated 

above until such representation is achieved. 

21. The hospital shall establish a semi-annual reporting 

system to HEW's Office for Civil Rights of Region V which 

includes: 

a. Patient days at each facility by race, discharge 

diagnosis, zip code and attending physician by coded 

number, indicating race of physician. 

b. X-Ray technicians, Lab technicians and nursing 

staff by race, zip code, department, total hours, and 

job classification. 

¢. Overtime of all non-physician staff by race 

and total hours. 

d. Equipment purchased for each facility over 

$10,000.00 and new services provided at each facility. 

e. Efforts of recruitment of staff. 

f. Utilization of transportation by race and 

facility. 

This information is to be used solely for the purposes of 

enforcing and monitoring this Consent Decree. Unless otherwise 

required by law, such information will not be released to 

anyone not engaged in enforcing and monitoring this Consent 

Decree. No effort will be made to decode the information 

in order to learn the identity of physicians. 

22. The Civil Rights Assurances signed by Methodist 

2 Oe 

  

 



Hospital on July 27, 1973, as modified herein, are incorporated 

  

herein and attachedias "Exhibit Cc", 

C. OBLIGATIONS OF THE STATE OF INDIANA. 
  

l. The State of Indiana will recommend and agree to 

the transfer of grant, loan guarantee and interest subsidies 

from Project 213 to the Gary facility to be used in conjunction 

with the grant, loan guarantee and interest subsidies from 

Project 212 to be applied to and to carry out the projects 

outlined in paragraph B-1 above. 

2. The State of Indiana will not oppose any of the 

building programs outlined above, particularly the one hundred 

five (105) beds at Broadway, except that this does not effect 

the State's obligations under 42 U.S.C. §1320a-1 and Public 

Law 93-641. 

3. The State of Indiana based upon the mutual and 

respective undertakings of the parties as herein set out, 

will decline to review the projects outlined in paragraphs 

B-l and 2a in its capacity as the designated planning agency 

under $1122 of the Social Security Act, as Afondan in 1972, 

42 U.S.C... 81320a~-1, 42 C.F.R. 100.106 and pursuant to its 

contract with the Department of Health, Education and Welfare 

does hereby notify the Secretary of Health, Education and 

Welfare of said declination and reasons therefor. 

4. The State of Indiana will process with all deliberate 

speed any applications, plans or other paperwork associated 

with or necessary for the completion of the programs described 

in paragraph B-1 and 2 hereof. 

D. OBLIGATIONS OF THE DEPARTMENT OF HEALTH, EDUCATION 
  

AND WELFARE OF THE UNITED STATES OF AMERICA. 
  

1. HEW shall perform the review and/or approval functions 

—-2]1- 

  

i 

 



ag explicitly set forth in paragraphs B.15, B.16, B 17, 

  

B 18, B 19 and B 21 of this Decree. 

2. HEW and Methodist Hospital will and do hereby revise 

the 1973 Civil Rights Assurance Number 3 to delete the approval 

required by the Area Comprehensive Health Planning Agency 

Or any other successor local planning agency. This revision 

does not relieve the hospital of any of its requirements 

under any statute including 42 U.S.C. 81320a-1 or Public 

Law 93-641. 

3. HEW will expeditiously complete the civil rights 

investigation of all dual site hospitals in Lake County 

and will investigate the legal basis of the civil rights 

responsibilities of single site hospitals. If it appears 

that further review of the single site hospitals under applicable 

law and policy is appropriate, review of single site hospitals 

in Lake County will be done as soon as possible. Plaintiffs 

and Methodist Hospital reserve their rights to challenge 

the determinations made by HEW in an appropriate forum. 

4. HEW agrees that the building programs outlined 

above, particularly the addition of the one hundred five 

(105) beds, will not congtitute a violation of Title VI 

of the Civil Rights Act or the Assurances signed by the 

hospital on July 27, 1973, and incorporated herein. HEW 

will not take action against the State defendants for declining 

to review the projects outlined in paragraphs B 1 and 2a 

above. Provided however, nothing in this Decree shall be 

construed: to constitute approval of the 105 bed addition 

outlinediin paragraph B 2b by HEW as an amendment to the 

1 State of Indiana Medical Facilities Plan or pursuant to 

$1122 of. the Social Security Act, 42 U.S.C. §1320a-1. 

— 

  

A 
3 

! 

 



  
i 
8 

5. HEW will transfer the grant, loan guarantee and 

interest subsidies from Project 213 to the Gary facility 

to be used in conjunction with the grant, loan guarantee 

and interest subsidies from Project 212 to be applied to 

and to carry out the projects outlined in paragraph B 1 

above. 

6. HEW will make available upon request of plaintiffs 

written communications between it and Gary Methodist Hospital 

and decisions made by HEW regarding compliance with this 

Decree which decisions shall likewise be made available 

to Gary Methodist Hospital. 

7. HEW will process with all deliberate speed any 

applications, plans or other paperwork associated with or 

necessary for the completion of the programs described in 

paragraph B hereof, and, that as to Part III and Part IV 

of the applications for the building programs for the Gary 

facility of Methodist Hospital and as to HEW's review of 

the Plans for said programs, HEW agrees to complete said 

review and approval functions within four (4) months of 

receipt of said completed applications, plans or other paperwork. 

E. OBLIGATIONS OF THE PLAINTIFFS. 
  

1s. The plaintiffs will not oppose any of the building 

programs outlined above particularly the one hundred five 

(105) beds at Broadway. 

2. Mayor Hatcher will make a good faith effort to 

supply additional street lights and security forces around 

the Gary facility and will participate in efforts to obtain 

public transportation service between Gary and Broadway. 

Mayor Hatcher shall make available the City's power of Eminent 

—-2 3 

  

 



Domain for and on behalf of the hospital to the extent provided 

  

by law to acquire any real estate needed in Order to carry 

out this Decree. Mayor Hatcher shall also assist in any 

needed vacation of Hayes Street. 

F. EXCLUSIVE REMEDY. 
  

This Consent Decree constitutes and embodies the exclusive 

remedy of the plaintiffs, the class they represent and the 

members thereof, for any and all claims, rights and causes 

of action of every nature which are within the scope of 

the Complaints or Decree arising out of, in connection with 

Or 1n any manner related to any and all acts and practices 

of alleged civil rights discrimination occurring at the 

respective facilities of Methodist Hospital prior to tha 

date of entry of this Decree and for all effects of the 

same, whether past, present or future. No other actions 

by the plaintiffs or any members of the affected class shall 

be brought against Methodist Hospital, HEW and the State 

of Indiana with respect to such claims, rights or causes 

of action in any form, administrative or judicial. The 

foregoing, however, shall not apply to allegedly discriminatory 

acts occurring after the date of this Decree and to any 

acts not within the scope of the Complaints or the Decree, 

excepting those acts which are specifically required in 

satisfaction and in performance of Methodist Hospital's 

obligations under this Decree. Notwithstanding the foregoing, 

HEW reserves its right to resort to the administrative action 

afforded to it pursuant to Title VI of the Civil Rights 

Act, 45 C.P.R. Parts 80 and 81 with respect to any allegedly 

discriminatory acts occurring after the date of this Decree. 

Further, proof of a breach of any part of this Decree with 

—-24- 

    

} 

 



  

° ’ J the exception of paragraphs B 2 (a) and B 2 ) by Methodist 

Hospital shall be grounds for the issuance by the Office 

for Civil Rights of Region V of a letter of findings under 

Title VI of the Civil Rights ‘Act, 45'C.P.R. Parts 30 and 

8l. In the event HEW resorts to the administrative procedure 

set forth above, Methodist Hospital explicitly reserves 

and retains all rights to which it is entitled under Title 

VI of the Civil Rights Act, and 45 C.P.R. Parts 80 and S51. 

G. RETENTION OF JURISDICTION. 
  

The Court shall retain‘jurisdiction for purposes of 

enforcement of this Consent Decree upon motion of any party 

or upon the Court's own motion. 

Entered this day of ri197     

      

JUDGE, UNITED STATES DISTRICT COURT 

The parties hereto by and through their respective 

attorneys do hereby approve the foregoing Consent Decree. 

IN WITNESS WHEREOF, those attorneys have subscribed 

their signatures hereunder. 

ATTORNEYS FOR PLAINTIFFS 

JACK GREENBERG 

BETH J. LIEF 

N.A.A.C.P. Legal Defense Fund 

A BY: ATE   
  

BETH J. LIEF 
N.A.A.C.P. Legal Defense Fund 
10 Columbus Circle, Suite 2030 
New York, New York 10019 

. — (0 oe or rt 
ha, ——— = L 

  TIE, A Fr 
2009 Broadway 
Gary, Indiana 

    

 



ATTORREYS FOR METHODIST 1IOSPITAL OF GARY ry INC. 
and DENIS E. RIBORDY, AS PRESIDENT OF THE 
BOARD OF DIRECTORS 

Q Sioa TN 2% Coe : / ) al Fd 

REAR J i STA WL FE Be coir a is KY IRL RANI Te. IS Cl, A  ———— 

BRUCE E. SAYERS. 

  

           

     EDWARD J. TSE 
HODGES, DAVIS, GRUENDB 

5525 Broadway : 
> Tap» 153iona 46410 

wil 5 
Yr PRLLY Co 

SEYFARTH, SIM, FAIRWEATHER & GERALDSON 

55. Bast Monroe Strect 

Chicago, Illinois 60603 

   

  

1P TON & SAYERS 
r~ 

RG,    

  

  

ATTORNEYS FOR JOSEPH CALIFANO, UNITED 

STATES SECRETARY OF HEALTH, EDUCATION AND WELFARE 

besos, S Ross 
REBECCA L. ROSS 

Department of Justice 

10th and Pennsylvania Avenue, N.W. 

Washington, D. C. 20201 

0 de 

  

  

ALBERT HAMLIN 
  

Assistant General Counsel 
Civil Rights Division 
Office of General Counsel 

Department of Health, Education and Welfare 
330 Independence Avenue, S. W. 
Washington, D. C. 2020} 

ATTORNEYS FOR WILLIAM 7, PAYNTER, M.D., AS 

STATE HEALTH COMMISSIONER FOR THE INDIANA 

STATE BOARD OF HEALTH, JAMES WHITE, 

AS DIRECTOR OF THE DIVISION OF HOSPITAL 

AND INSTITUTIONAL SERVICES OF THE INDIANA 

STATE BOARD OF HEALTH, and DAVID J. 

EDWARDS, M.D., AS DIRECTOR OF THE HEALTH 

FACILITIES, SERVICES AND REVIEW DEVELOPMENT 

BUREAU OF THE INDIANA STATE BOARD OF 

HEALTH 

THEODORE L. SENDAK 

ATTORNEY GENERAL es STATE OF INDIANA 

BY: 7 ve Lois FN Ze 
ERIC B. SERVAAS 

Deputy Attorney General 
219 State House 

Indianapolis, Indiana 46204 

    

    

 



Methodist Hospital of Gary 

  

Violations - Life Safety Code #101 
of N.F,P.A, 

Architectural Violations 

Smoke Compartmentation - 

Limit each compartment to no more than 22,500 sq. ft., 

of which both length and width are limited to 150 feet. 

  

Smoke Doors - 

Must be self-closing, when actuated to release from 

open position by electrical hold open devices. 

Stairwell Doors - 
Must be labeled, Class B, self-closing and 

latching with proper hardware. 

Corridors = 

Below minimum width, must establish equivalencies 
such as updating stairwells, smoke compartmentation 

and fire alarm system. 

1957 building and 4th floor 1942 building do not 
complete closure from floor to the underside of 
slab. 

Linen Chutes - 
Doors shall be kept locked when located on corridors. 

All chutes: shall have a Class B 11 hour rated door, 
self-closing and positive latch. 

Terminal end of chute shall be equipped with a 
self-closing device and positive latch. 

Mechanical Violations in 1923 Building 

The ground floor Central Supply Storage Room and 

Pharmacy Storage Room require sprinklers. 

  

Linen Chute - 
Sprinklers at alternate floor levels. 

To be extended full size through the roof. 

The supply ducts of Central Supply are covered with 

combustible canvas. Insulation must meet maximum 

flame spread rating of 25 and smoke developed rating 

of 150. 

The floor separations are not fire sealed to prevent the 

passage of smoke. 

There are no fire dampers in ducts penetrating two hour 

rated walls and floors. 

4/11/78 EXHIBIT A 

 



Violations 1923 Building (continued)   

  

This building is not smoke separated from the adjoining 

buildings. 

Duct systems must be equipped with smoke dampers 

and actuated by smoke detectors. 

Provide smoke detectors in the supply systems {to ah / 

prevent the distribution of smoke. 

Mechanical Violations in 1843 Building 
  

Sprinklers are required in Medical Records and the 
Storage Rooms located on Ground Floor, Linen Storage 

Rooms on Penthouse Floor. 

The hood griddle located in the Cafeteria requires 

an extinguishing system with fuel (electric or gas) 
shut-off. 

Alcohol Storage Room on Ground Floor will be relocat- 

ed to room complying with code. 

The building exceeds 150 feet in length, and therefore requires 

smoke barriers, and it is not smoke separated from the adjoin- 

ing buildings. 

All ducts which may distribute smoke from the fire zone 

shall be equipped with smoke dampers and actuated 
by smoke detectors in the duct system. 

Provide smoke detectors in the supply systems to prevent 
the distribution of smoke. 

Combustibles are not permitted to be stored in the Penthouse 
Gas Storage Room 572. 

There are no fire dampers in ducts penetrating two hour 

fire rated walls and floors. 

The floor scparations are not fire scaled to prevent the 

passage of smoke. 

Mechanical Violations in 1957 Bullding 
  

Sprinklers are required in all storage rooms, such as 

BlG, BYE, BIC, BIB, GHC, "G5, ‘G2, etc. 

Some storage rooms are not properly fire-rated enclosed 

such as relief openings. 

-7- 

EXHIBIT A 
4/11/78 

 



Mechanical Violations in 1957 Building (continued) 

Corridor door louver to Ultra-Sound Room. 113 

must be removed. 

All laboratory sinks require vacuum breakers. 

The shut-off valve on the sprinkler system serving 

the Laundry Clean Linen Rooms requires a supervised 

lock, and the existing flow alarm shall be connected 

to the fire alarm system. 

return air outlets. Corridor door louvers must be 

removed and an exhaust/return system with outlets near 

the floor and arranged for positive pressures must be 
provided. 

Linen Chute System 

Sprinklers at alternate floor levels. 

To be extended full-size through the roof. 

The floor separations are not fire sealed to prevent the 
passage of smoke. 

There are no fire dampers in ducts penetrating two hour 

fire rated walls and floors. 

The building exceeds 150 feet in length, and therefore 
requires smoke barriers, and it is not smoke separated 

from the adjoining buildings. 

All ducts which may distribute smoke from the 

fire zone shall be equipped with smoke dampers and 

actuated by smoke detectors in the duct system. 

Provide smoke detectors in the supply systems to 
prevent the distribution of smoke. 

Mechanical Violations in 1961 Building   

Mechanical Equipment Room B27 

All supply ducts are covered with combustible canvas. 

Insulation must meet maximum flame spread rating of 

25 and smoke developed rating of 50. The equipment 

room is a plenum. 

Remove relief opening in corridor wall. 

Provide electric griddle shut-off with the extinguishing 

system of the Coffee Shop hood and connect to the fire 
alarm system. 

The floor separations are not fire sealed to prevent the 

passage of Smoke  



    

    

       

   

  

     

          

  
     

      
        
    

There are no fire dampers in ducts penetrating two hour 

fire rated walls and floors. 

) Mechanical Violations in 1961 Buildina (continued) 

  

  

       
    

The building is not smoke separated from the adjoining 

buildings. 

All ducts which may distribute smoke from the fire 

zone shall be equipped with smoke dampers and actuat- 

ed by smoke detectors in the duct system. 

   

            
     

          
   

      

Provide smoke 

prevent 

detectors in the supply system to 
the distribution of smoke. 

  

Mechanical Violations in 1965 Building 
  

  

        
   

The laboratory hood in Room B33 requires a vacuum breaker. 

    
        

    
    

      

There are no fire dampers in ducts penetrating two hour fire 
rated floors and walls, 

  

        

Provide smoke detectors in the supply system to prevent the 
distribution of smoke. 

Mechanical Violation in 1972 Building 
      

              

        
   
     

    
     
    
     
     

      
      

   

Seal all penetrations of smoke barriers. 

  

Violations       Mechanical in Dietary Building 
  

The hood extinguishing systems are not a@nnected to the 
fire alarm system and does not shut-off the gas fuel. 

Electrical Violations - General (Applies to all Buildings) 
  

Fire Detection and Alarm System - 

    Smoke compartmentation has not been provided. Doors in 

smoke partitions are required to be either kept closed 

or held open electrically. Smoke dampers in ducts are 
to be controlled by a smoke detector located in the 

ventilating system. Supply and exhaust fans are to be 

controlled by smoke detectors at the respective fan 

locations. 

       

   
            

     

         

  

All 
System. 

  

smoke detectors shall also activate the fire alarm      

Automatic fire extinguishing sprinkler heads scattered 

throughout the facility. Flow alarms are required to 

be connected into the fire alarm system.       

    4/11/78 Exhibit A



    

Flectrical Violations in 1923 Building      

  

       
   
     
   

    

Operating rooms, located on the fifth floor. 

       Receptacles above the five foot level are 
standard parallel-blade duplex type. 

   No signs are posted within the room for 
non-flammable anesthesia.     

     
       
        

    

    

    

Electri cal Violations In) 943 Building 
    

Alcohol storage room contains no lighting. Room 
will be relocated.   

   
Delivery rooms no '"equipotential grounding" is 
provided. 

   
Delivery rooms standard parallel-blade duplex receptacles 

are being utilized.      

    

  

Electrical Violations in 1957 Building 
  

    

   
    

  

    

    

  

   

Operating room Fifth floor. 

    

Receptacles above the five foot level are 
standard parallel-blade duplex type. 

   
No signs are posted within the room regarding 
non-flammable anesthesia. 

General (This is in addition to ROFEC list) 
  

   Fire-proofing of ceiling and exposed steel - boiler 

house. 

         

      

  

Excessive size borrowed lights in doors and corridors. 

TOTAL ESTIMATED COST $1,500,000.00 

   
4=5-7% 
Revised 4-11-78 

    4/11/78 5 Exhibit A



  

Health Services Building - Broadway 
Program/Services Description 

  

Program and Services: 

First Floor   

1) Out-Patient Department 

Registration Ambulatory Services 
Billing 

2) Admitting 

In-Patient 

3) Coffee Shop 

Staff/Visitors 

4) Lobby area expanded 
Visitors 
In-Patient Admitting 

o
u
 

Ambulatory Care Services 

Cancer Program/Regional for 5 counties 
Executive Physical Service 
Cast Removal Service 
Pulmonary Screening 

E.E.G./E.M.G. (in-patient and out-patient) 
Pre-admission Service 
Blood Drawing/Pathology 

6) Nuclear Medicine Department (relocated) 

1) Computerized Isotopic Scanning Camera 

2) Large-field of View Scanning Camera 

Basement   

1) Auditorium 

Medical Education 

Employee Education 
Patient Education 
Storage 

Affiliating Education Programs 

2) Classrooms (2) 

3) Mechanical Area 

4-11-78 EXHIBIT B 

 



Building #2 (Cancer Program/Radiology)   

Plrst Floor   

Physicist Work Area/Office 
Oncology Office 
sxam/Recovery Therapy Area 
Therapy Waiting Area 

Special Procedures and Control 

Lymphangiography 

Angiography (no cardiac specials) 
Scrub Area 

Xeriography 

Viewing Area/Films 
Staff Lounge/Employees 
Ultra Sound Room 

X-Ray #5 Diagnostic with Simulator 
Control Area 
Storage (Emergency Room/Sterile Supplies) 

Basement 

Storage: 

Medical Records   

In-Patient 

Out—-Patient 

General. Storage   

Laboratory 
Radiology 
Dietary 
Housekeeping 

Plant Operations 
Pharmacy 

Respiratory Therapy 
E.K.G. 

Miscellaneous 

4/11/78 EXHIBIT B  



    

  

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PROJECT: INDIANA NO. 213 

  

WELT na 

  

  

   
HEALTH SERVICES BUILDINGS & | 2am} tevicm 
LAUNDRY ADDITIONS TO 

BROADWAY METHODIST HOSPITAL | mouse 
MERRILLVILLE INDIANA B.WE     

  

SCHMIDT, GARDEN & ERIKSON 
104 SOUTH MICHIGAN AVENUE, CMICA®0 

ARCHITECTS 

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IN THE 

UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF INDIANA 

HAMMOND DIVISION 

BARBARA LEEK WESSON, et al, 

Plaintiffs 

VS. Cause No. H 76-373 

METHODIST HOSPITAL OF GARY, INC., 

¢t al., 

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Defendants 

RICHARD GORDON HATCHER, et al.y 

Plaintiffs 

VS. Cause No. H 77-154 

METHODIST HOSPITAL OF GARY, INC., 
et al. 

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Defendants 

NOTICE OF PROPOSED SETTLEMENT 
CONSENT DECREE AND HEARING 
  

  

TO: ALL BLACK RESIDENTS OF GARY, INDIANA 

PLEASE READ THIS NOTICE CAREFULLY 
  

A proposed settlement has been reached in the above- 
captioned actions with respect to Methodist Hospital of 
Gary, Inc. and incorporated in a proposed Consent Decree 
which has been submitted to this Court for its consideration 
and approval. The proposed Consent Decree has been approved 
by all of the attorneys of record for the plaintiffs and 
defendants named herein. 

The purpose of this Notice is to announce the proposed 
entry of the Consent Decree to members of the affected class 
defined in the Decree and to other persons who may be affected 
by entry of the Decree. This Notice is not intended to 
vary any of the terms of the proposed Consent Decree. A 
copy of the proposed Consent Decree is on file with this 
Court and is available for examination in the office of 
the Clerk of the Court on the lst Ploor of the Federal Office 
Buiding, 507 State Street, Hammond, Indiana 46320. 

 



  

® ® 

Civil Action No. H 76-373 was commenced in December 
of 1976, by Bernice Terry, Rosa Keeton, Barbara Leek Wesson 
and Eddie Gray against Methodist Hospital of Gary, Inc. 
and David Mathews as Secretary of the Department of Health, 
Education and Welfare as a class action. Civil Action No. 
H 77-154 was commenced in May of 1977, by Richard Gordon 
Hatcher, Metro Corps of Gary, Inc. and Willie Lee Page against 
Methodist Hospital of Gary, Inc., Denis E. Ribordy, as President 
of the Board of Directors of Methodist Hospital of Gary, 
Inc. (hereinafter collectively referred to as the Hospital), 
Joseph Califano, as Secretary of the Department of Health, 
Education and Welfare (hereinafter referred to as HEW) , 
William T. Paynter, M.D., as Indiana State Health Commissioner, 
and David J. Edwards, M.D., as Director of the Health Facilities, 
‘Services and Review Development Bureau of the Indiana State 
Board of Health (hereinafter collectively referred to as 
the "State of Indiana") as a class action. 

These actions subsequently were consolidated by the 
Court, and are class actions alleging racial discrimination 
by the defendants in violation of Title VI of the Civil 
Rights Act of 1964, as amended, the Fifth and Fourteenth 
Amendments to the United States Constitution and various 
other civil rights statutes, regulations, rules and assurances. 

By Order dated December 7, 1977, this Court determined 
that the cases be maintained as a class action on behalf 
of a class of all Black residents of the City of Gary, Indiana. 
The affected class is so defined in the proposed Consent 
Decree. 

The plaintiffs and defendants, by their attorneys, 
have made a thorough and detailed investigation of the facts 
and circumstances involved in these actions and have conducted 
extensive discovery by various means, including oral examinations 
by deposition, written interrogatories, and examination 
of voluminous documents and records concerning the parties 
and issues involved in these actions. After taking into 
account the likelihood that this litigation, if not settled 
now, will be protracted and extensive, involving many questions 
of law and fact and potential time-consuming and expensive 
appeals, counsel for all parties concluded that it would 
be in the best interests of the plaintiffs, the affected 
class and each member thereof, and the defendants to settle 
these actions on the terms of the proposed settlement which 
are incorporated in the proposed Consent Decree. 

Neither Methodist Hospital nor HEW nor State of Indiana 
have admitted, nor has this Court determined, that there 
has been any violation by any of the defendants of any of 
the above-named statutes or any other law, rule, assurance 
or regulation, or that any of the defendants admit liability 
for any alleged injuries suffered by any plaintiff. 

De 

 



® * 

  

PLEASE TAKE NOTICE THAT pursuant to an Order of the 
United States District Court for the Northern District of 
Indiana dated v:19 a hearing will 
be held in the above-captioned cases in the Court of the 
Hon. Phil McNagny, Jr., United States District Court for 
the Northern District of Indiana, Hammond Division, Federal 
Building, 507 State Street, Hammond, Indiana, at 

«11. .0N ’ ’ 
19 , (hereinafter referred to as "Hearing"), to determine 
(1) the fairness, reasonableness and adequacy of the proposed 
Consent Decree; (2) whether the affected class as defined 
in the proposed Consent Decree is properly defined and determined; 
(3) the effects of the settlement and proposed Consent Decree 
upon persons who are not members of the affected class; 
and (4) whether the proposed Consent Decree should be approved 
finally by the Court. The Hearing may be adjourned from 
time to time by the Court at the Hearing or at any adjourned 
session thereof without further notice. 

  

  

  

  

This Notice is given to you in the belief that you 
are, were, or may be a member of the affected class, or 
that your rights may be affected by these actions or the 
proceedings described in this Notice. 

This Notice is not an expression of any opinion by 
this Court as to the merits of or the defenses in these 
actions, but is solely to inform you of the pendency of 
these actions and of the proposed settlement and proposed 
Consent Decree so that you may decide what steps you wish 
to take in relation to these lawsuits and the proposed Consent 
Decree. 

The Consent Decree entered shall include and bind all 

members of the affected class, whether or not they join 
or intervene in these actions. 

If you are satisfied with the proposed Consent Decree 
or if you have no objection to it, you need not appear at 
the Hearing referred to in this Notice. 

  

  

  

Any person who is dissatisfied with the proposed settlement 
or proposed Consent Decree may appear at the Hearing in 
person or with counsel and show cause, if there be any, 
why the proposed affected class should not be defined as 
above described, or why the proposed settlement and the 
proposed Consent Decree should not be approved. Such objections 
also may be made in writing by mailing or delivering a written 
statement of the objections to the Clerk of the United States 
District Court for the Northern District of Indiana, lst 
Floor, Federal Office Building, 507 State Street, Hammond, 
Indiana 46320, by 5:00 p.m., on ’ 

19 . If such written objections are made, 
the persons making such objections should appear at the 
Hearing. Any class member and any person who is or may 
be affected by the proposed settlement, the proposed Consent 
Decree and the prior orders of this Court, who do not make 

  

  

We Th 

 



  

objections in the manner provided herein shall be deemed 
to have waived such objections and shall be foreclosed forever 
from making any such objections, by appeal or otherwise, 
to the proposed settlement, the proposed Consent Decree 
and the prior orders of this Court. 

This Court's approval of the proposed Consent Decree 
shall be final, and upon the entry of the Consent Decree 
and expiration of the time limit for appeal therefrom, all 
defendants shall be released, without further act by any 
person, agency or entity, from any and all liability, claims, 
and causes of action, joint or several, arising (1) from 
alleged acts and practices of discrimination by the defendant 
Methodist Hospital which properly are within the scope of 
the complaints herein, and to which the Consent Decree is 
directed to the date of the entry of the Decree, and (2) 
from alleged past, present or future effects of any such 
acts and practices, and (3) from the present or future effects 
of any acts and practices required or authorized by or defined 
in the proposed Consent Decree. 

The issuance of this Notice shall not affect any issue 
in these actions, until and unless the Court approves the 
proposed Consent Decree, and then only in accordance with 
the Consent Decree. In the event this Court approves the 
proposed Consent Decree, the Decree will be entered immediately. 

For a more detailed statement of the matters involved 
in these actions and the proposed Consent Decree, you are 
referred to the pleadings, the proposed Consent Decree, 
and to the other papers on file in these actions, all of 
which may be inspected at the office of the Clerk of the 
United States District Court for the Northern District of 
Indiana, lst Floor, 507 State Street, Hammond, Indiana, 
during the business hours of the Court. 

  

THE PROPOSED SETTLEMENT 

The following is a summary of the main provisions of 
the proposed Consent Decree: 

l. The following building programs will be undertaken 
at Gary Methodist Hospital: Medical Services Building (on 
the west side of the hospital) to contain a new Surgical 
Suite, Intensive and Coronary Care Unit, Central Supply, 
Nuclear Medicine, expanded Emergency Room and a 24 hour 
Pharmacy. The foundation for this building will be capable 
of supporting one additional floor. 

Remodeling, including an area to house a Family Practice 
Residency Program, provision of an adequate power plant, 
refurbishing Labor and Obstetrical Department; remodeling 
to provide an Auditorium; provide secure parking areas; 
remodeling areas for ambulatory care clinics; establishment 
of an Intermediate Cardiac Care Unit, Stress Testing and 
Cardiac Rehabilitation Laboratory; and steps to bring the 
hospital into compliance with the Life Safety Code of 1973. 
In addition, a laundry will be built on a yet to be named 
site in Gary, Indiana to provide laundry facilities for 
both the Gary and Broadway sites of Methodist Hospital. 
The site will be provided by the City of Gary. 

 



  

This building program is to be financed by a federally 
guaranteed loan and interest subsidy, and by other private 
financing. 

2. The following building programs will be undertaken 
at Broadway Methodist Hospital: A Health Services Building 
and a 105 bed addition. 

This building program will be financed by private financing. 

3. The building programs will be commenced on a substantially 
identical chronological basis. Progress of the programs 
will be jointly monitored by the parties. 

4. Efforts will be made to maintain the occupancy 
rate at the Gary facility at an efficient level (including 
urging patients applying at the Broadway facility to go 
to the Gary facility rather than be placed on a waiting 
list. Efforts will be expended to further integrate the 
staffs and patient census at both facilities. Furthermore, 
the Hospital shall provide adequate and comparable doctors’ 
coverage in the Emergency Room including the availability 
of staff specialists for consultation at both sites. Additionally 
the Hospital will insure that all nursing shifts are adequately 
covered at both facilities. Comparable medical education 
of staff and patients will be provided at both facilities. 

5. Ambulatory care services will be expanded at the 
Gary facility with the development of an outreach program 
to foster utilization of the ambulatory care services as 
well as the Family Practice Residency program. Any new 
services provided by the Hospital will be placed at the 
Gary facility unless such placement would be inconsistent 
with good hospital management principles. Furthermore, 
prior to placing any new clinics at the Broadway facility, 
it must be demonstrated to HEW's Office for Civil Rights 
of Region V that there is a need for such a clinic at the 
Broadway facility and that there are adequate hours and 
staffing at the clinics at the Gary facility. 

6. Future purchases of equipment shall be made on 
an equitable basis between facilities and any purchase of 
equipment costing over $100,000.00 shall be approved for 
civil rights purposes by HEW's Office for Civil Rights of 
Region V. 

7. Transportation services at no charge will be developed 
by a consultant between the two facilities for ambulatory 
patients and hospital staff going to and from work. In 
-addition, the parties agree to work to obtain public transportation 
between the facilities. 

8. The Board of Directors of the Hospital will be 
restructured to insure representation of members of minority 
groups in Gary and the handicapped and minority groups in 
the patient population at both facilities by 1981. At least 
one-third of the members of the Board of Directors shall 
be members of minority groups. 

 



  

9. The Hospital will report in a coded system on a 
semi-annual basis to HEW concerning coded patient days at 
each facility by race, diagnosis, zip code, and race and 
coded number of physician; concerning staff, overtime, equipment 
purchases over $10,000.00; efforts at recruitment of staff 
and utilization of the transportation system will be provided 
to HEW. This information is to be used solely to assist 
in monitoring the Consent Decree. 

10. The Hospital will develop a Long Range Plan for 
both Hospitals by December, 1978, to be approved for civil 
rights purposes by HEW and attorneys for the plaintiffs. 
HEW is not precluded from requiring additional commitments 
and resources from Methodist Hospital ‘that it requires of 
all other Hospitals in Lake County nor from requiring any 
joint planning it requires of any other Hospitals in Lake 
County, Indiana. | 

11. The State of Indiana will take steps to facilitate 
the financing of the Gary facility construction; will not 
oppose any of the building programs; and, will decline to 
review the building projects except for the 105 bed addition, 
under §1122 of the Social Security Act. 

12. HEW will revise Assurance Number 3 of certain Civil 
Rights Assurances signed by the Hospital and HEW on July 
27, 1973; expeditiously complete its county wide hospital 
civil rights Review; take steps to facilitate the financing 
of the Gary facility building project; and, agree that the 
building programs outlined herein do not constitute a violation 
of Title VI of the Civil Rights Act or the July 27, 1973 
Civil Rights Assurances. HEW further agreed not to take 
or support any other action, administrative or otherwise, 
based upon alleged civil rights violations which have been 
alleged or are within the scope of the Complaints filed 
in the suits. 

13. The plaintiffs will not oppose any of the building 
programs. Mayor Richard Gordon Hatcher will make good faith 
efforts to supply additional lighting and security forces 
at the Gary facility; participate in efforts to secure public 
transportation between the Gary and Merrillville facilities; 
make available the City's powers of eminent domain to facilitate 
the building programs; and, provide the Hospital with a 
2 to 3 acre site on which to construct the laundry. 

If you have any questions concerning this Notice, any 
of the matters discussed in this Notice, or the proposed 
settlement or proposed Consent Decree, you may contact Beth 
J. Lief, N.A.A.C.P. Legal Defense Fund, 10 Columbus Circle, 
Suite 2030, New York, New York 10019, telephone number 212/586- 
8397, Attorney for the plaintiffs; Bruce E. Sayers and Edward 
J. Hussey, Hodges, Davis, Gruenberg, Compton & Sayers, 5525 
Broadway, Gary, Indiana 46410, telephone number 219/981- 
2557 and Raymond J. Kelly, Seyfarth, Shaw, Fairweather & 

, Geraldson, 55 East Monroe Street, Chicago, Illinois 60603, 
telephone number 312/346-8000, attorneys for defendants 

/ Methodist Hospital of Gary, Inc. and Denis E. Ribordy, as 
President of the Board of Directors; Rebecca L. Ross, Department 

Briandes Y 
\ RQ /\ ™\ NN 1 : 4 x nT 

NOAH ~ . 6 

 



  

: ® ® 

of Justice, 10th and Pennsylvania Avenue, N.W., Washington, 
D.C., telephone number 202/739-2230 and Edward L. Koven, 
General Attorney, Department of Health, Education and Welfare, 
300 South Wacker Drive, 18th Floor, Chicago, Illinois, telephone 
number 312/353-9453, Attorneys for Joseph Califano, United 
States Secretary of Health, Education and Welfare; and Eric 
B. Servaas, Deputy Attorney General, State House, Indianapolis, 
Indiana 46204, telephone number 317/633-5512, Attorney for 
the State of Indiana. 

Dated this day of + - 1978,   
  

  

JUDGE, UNITED STATES DISTRICT COURT 

 



  

IN THE 

UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF INDIANA 

HAMMOND DIVISION 

BARBARA LEEK WESSON, 
BERNICE TERRY, 
EDDIE GRAY and 
ROSA KEETON, 

Plaintiffs 

VS. 

METHODIST HOSPITAL OF GARY, INC., 
An Indiana Not For Profit 
Corporation, and JOSEPH CALIFANO, 
as United States Secretary of 
Health, Education and Welfare, 

Defendants 

RICHARD GORDON HATCHER, 

WILLIE LEE PAGE, 

METRO CORPS OF GARY, INC., 

A NMot-Por-Profit Corporation 
and others similarly situated, 

Plaintiffs 

VS. 

METHODIST HOSPITAL OF GARY, INC., 

An Indiana Not-For-Profit 
Corporation and DENIS E. RIBORDY, 
as President of the Board of 
Directors, 

JOSEPH CALIFANO, as United States 
Secretary of Health, Education 
and Welfare, 

WILLIAM T. PAYNTER, M.D., as 

State Health Commissioner for the 

Indiana State Board of Health, 

DAVID J. EDWARDS, M.D., as 

Director of the Health Facilities, 

Services and Review Development 
Bureau of the Indiana State Board 
of Health, 

Defendants 

JOINT MOTION FOR APPROVAL OF SETTLEMENT AND 

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Cause No. 

Cause No. 

  

H 

H 

76-373 

77-154 

CONSENT DECREE, AND FOR SETTING OF HEARING ON OBJECTIONS 
  

Counsel for plaintiffs and defendants in the above- 

captioned cases represent to the Court as follows: 

 



  

l. Counsel for all of the parties in the above-captioned 

cases have agreed upon a settlement thereof with the exception 

of plaintiffs' allegations with respect to the "national causes 

of action" limited only to defendant, Joseph Califano, United 

States Secretary of Health, Education and welfare, which were 

severed by this Court's Order of January 13, 1978, and plaintiffs 

allegations of "statewide causes of action" limited to the State 

of Indiana defendants. Further, counsel for plaintiffs reserve the 

right to apply to this Court for an Order for the entry of attorneys’ 

fees and costs against the defendants and counsel for the defend- 

ants deny the right of counsel for the plaintiffs to apply to this 

Court for attorneys' fees and specifically reserve any and all 

rights they have to dispute or deny defendant such claims of the 

counsel for the plaintiffs, except that they shall not claim that 

counsel for plaintiffs have waived their right to apply for attorneys’ 

fees and costs by entering into the Consent Decree. A proposed 

Consent Decree incorporating that settlement and its exhibits is 

attached hereto as Exhibit A. 

2. Counsel for all of the parties also have agreed upon the 

form of a Notice of Proposed Settlement, Consent Decree and Hearing 

to be given to all Black residents of Gary, Indiana, a copy of 

which is attached hereto as Exhibit B. 

WHEREFORE, counsel for all Slate iors and defendants move the 

Court as follows: 

l. To approve the Notice of Proposed Settlement, Consent Decree 

and Hearing, and order that said Notice be published ... 

(To be agreed upon, i.e., Gary Post-Tribune, dates of 

publication). 

2. To set a date certain by which any written objections 

to the proposed Consent Decree must be filed with the Clerk 

De 

 



oh ® 

  

of the United States District Court for the Northern 

District of Indiana, Hammond Division, and to set a 

subsequent date certain for a hearing on any objections 

which may be filed to the proposed Consent Decree and on 

the advisability of the settlement of these cases in 

accordance with the terms of the proposed Consent Decree. 

3. To approve the proposed Consent Decree in the 

form presented to this Court, subject to the considera- 

tion of any objections which may be made thereto, and to 

enter said Consent Decree and Judgment thereon thereby 

finally disposing of all but plaintiffs' "national and 

statewide causes of action" and attorneys' fees issues 

referred to in paragraph 1 above. 

4. To make such other directions and orders with 

respect to these cases and the proposed Consent Decree 

as the Court may deem just and proper. 

Respectfully submitted, 

  

JACK GREENBERG 

10 Columbus Circle 

Suite 2030 

New York, New York 10019 

  

BETH J. LIEF 

10 Columbus Circle 

Suite 2030 

New York, New York 10019 

  

"JULIAN B. ALLEN, JR. 
2009 Broadway 

Gary, Indiana 46410 

 



  

ATTORNEYS FOR METHODIST HOSPITAL OF 

GARY, INC., and DENIS E. RIBORDY, AS 

PRESIDENT OF THE BOARD OF DIRECTORS 

  

BRUCE E. SAYERS 

  

EDWARD J. HUSSEY jr 

HODGES, DAVIS, GRUENBERG, COMPTON & 

SAYERS 

5525 Broadway 

Gary, Indiana 46410 

  

RAYMOND J. KELLY 

  

MARC KRASS 

SEYFARTH, SHAW, FAIRWEATHER & 

GERALDSON 

55 East Monroe Street 

Chicago,. Illinois 60603 

ATTORNEYS FOR JOSEPH CALIFANO, UNITED 

STATES SECRETARY OF HEALTH, EDUCATION 

AND WELFARE 

  

REBECCA IL. ROSS 

Department of Justice 

10th and Pennsylvania Avenue, N.W. 

Washington, D. C. 

  

ALBERT HAMLIN 

Assistant General Counsel 

Civil Rights Division 

Office of General Counsel 

Department of Health, Education and 

Welfare 

330 Independence Avenue, S. W. 

washington, D. C. 20201 

  

JEFFREY CHAMPAGNE 

Attorney, Office of General Counsel 

Civil Rights Division 

Department’ of Health, Education and 

Welfare : 

330 Independence Avenue, S. W. 

Washington, D. CC. 20201 

  

FRED W. GRADY 

Assistant United States Attorney 

United States District Court 

Northern District of Indiana 

Federal Building, 507 State Street 

Hammond, Indiana 46320 

op, 

 



  

ATTORNEYS FOR WILLIAM T. PAYNTER, M.D., 

AS STATE HEALTH COMMISSIONER FOR THE 

INDIANA STATE BOARD OF HEALTH AND DAVID 

J. EDWARDS, M.D.,. AS DIRECTOR OF THE 

HEALTH FACILITIES, SERVICES AND REVIEW 

DEVELOPMENT BUREAU OF THE INDIANA STATE 

BOARD OF HEALTH 

  

THEODORE SENDAK 

Attorney General 

  

ERIC B. SERVAAS 

Deputy Attorney General 

State House 

Indianapolis, Indiana 46204 

 



IN THE 

  

UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF INDIANA 

HAMMOND DIVISION Yo 

BERNICE TERRY, ET AL., 

Plaintiffs 

VS. Cause No. H 76-373 

METHODIST HOSPITAL OF GARY, INC., 

An Indiana Not-For-Profit 
Corporation, and JOSEPH CALIFANO, 
as United States Secretary of 
Health, Education and Welfare, 

Defendants 

RICHARD GORDON HATCHER, 

WILLIE LEE PAGE, 

METRO CORPS OF GARY, INC., 

A Not-For-Profit Corporation 
and others similarly situated, 

Plaintiffs 

VS. Cause No. H 77-154 

METHODIST HOSPITAL OF GARY, INC., 

An Indiana Not-For-Profit 
Corporation and DENIS E. RIBORDY, 
as President of the Board of 

Directors, 

JOSEPH CALIFANO, as United States 

Secretary of Health, Education 

and Welfare, 

WILLIAM T. PAYNTER, M.D., as 

State Health Commissioner for the 

Indiana State Board of Health, 

JAMES WHITE, as Director of the 
Division of Hospital and 
Institutional Services of the 
Indiana State Board of Health, 

DAVID J. EDWARDS, M.D., as 

Director of the Health Facilities, 

Services and Review Development 
Bureau of the Indiana State Board 

of Health, 

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Defendants 

FINDINGS OF FACT, CONCLUSIONS OF LAW 

AND ORDER CONCERNING CONSENT DECREE 

AND OBJECTIONS THERETO 

  

  

  

These cases came on for hearing on July 17, 1979, on the 

  

 



  

joint motion of counsel for all parties for approval by the 

Court of the settlement agreed to by all counsel, and for 

entry of the proposed Consent Decree incorporating that 

settlement. 

Pursuant to the June 8, 1979, "order of this Couri, a 

written Notice of the proposed settlement, the proposed 

Consent Decree and this hearing was published on June 12 and 

June: 19, 1979 in the ‘Post Tribune, a newspaper of general 

circulation in the Lake County area and in INFO on June 14 and 

June 21, 1979, a newspaper of general circulation in the City 

of Gary, Indiana. Appendices A and B are true and correct 

copies of the aforesaid notices. 

Said notice advised the persons to whom it was directed 

that any person dissatisfied with the proposed settlement or 

proposed Consent Decree could appear at the hearing set for 

3:00 P.M., July 17, 1979, in person or with counsel, and show 

cause, if there be any, why the proposed affected class should 

not be defined as described in said notice, or why the 

proposed settlement and proposed Consent Decree should not be 

approved, and that any such objections could also be made in 

writing by mailing or delivering a written statement of the 

objection to the Clerk of this Court by 5:00 P.M. on July 11, 

1979. | 

Subsequent to the issuance of said Notice, one written 

objection was filed by the Northern Indiana Health Systems 

Agency, Inc. with the Clerk of this Court on July 3, 1979, said 

objection being appended hereto as Appendix C. 

At ‘the hearing on July 17, :1979, the attorneys for the 

parties, members of the class and other interested individuals 

presented to the Court the historical development of this 

  

 



  

litigation and the negotiations resulting in the Settlement 

Agreement and proposed Consent Decree. No representative or 

attorney for the Northern Indiana Health Systems Agency, Inc. 

appeared or participated in the hearing. 

With respect to the objection of the Northern Indiana 

Health . Systems Agency, Inc., "its objection contends that 

because of its obligations under certain health planning 

statutes and regulations that the settlement in this matter 

should have been submitted to and roviowed by the Northern 

Indiana Health Systems Agency, Inc. | 

The Court notes that the proposed Consent Decree refers 

to specific provisions of Federal health planning statutes, 

inter alia, the Public Health Resources and Development Act, 

42 U.S.C. §3001 et seq. and §1122 of the Social Security Act, 

42 U.8.C. §1302a~1 and Public Law 93-641. The Consent Decree 

refers to and the Northern Indiana Health System Agency, 

Inc.'s objection acknowledges that the State of Indiana 

defendants and defendant, Secretary of Health, Education and 

Welfare, have the ultimate authority spelled out by these 

planning laws. Pursuant to Public Law 93-641, Northern 

indiana Health Systems Agency, Inc. is to assist the state 

health planning and development agency in carrying out its 

functions including the review and recommendation to the 

appropriate state health planning agency respecting the need 

for new institutional health services. Further, the function 

of the Northern Indiana Health Systems Agency, Inc. pursuant 

to §1122 of the Social Security Act is investigation and 

recommendation. Ultimate approval rests with the defendant, 

Secretary of Health, Education and Welfare. 

The Court further notes that Kipton Kaplan as Executive 

Director of the Northern Indiana Health Systems Agency, Inc. 

  

 



  

was an original party defendant to Cause Number H 77-154 but 

was dismissed by this Court's Order of December 7, 113177, 

pursuant to his Motion contending that the State and Federal 

defendants in their capacity as ultimate decision makers could 

provide a final disposition of the plaintiffs' claims in this 

litigation. 

The attorneys and representatives of the defendants have 

described for the Court the negotiations that have taken place 

stating that participation of the State of Indiana defendants 

and defendant, Secretary of Health, Education and Welfare in 

these specific circumstances involving Methodist Hospital of 

Gary, Inc. has provided sufficient analysis and review of the 

provisions of the proposed Consent Decree pursuant to the 

Federal planning statutes and regulations so that the 

assistance from the local planning agency, the Northern 

indiana  Health® Systems  3gency,. Ince, ' 1s not . required. 

Accordingly, the Court denies the objection of the Nor thern 

Indiana Health Systems Agency, Inc. 

The Court has thoroughly reviewed the provisions of the 

Settlement Agreement and proposed Consent Decree submitted to 

it for approval. The Court has also become thoroughly 

familiar with the extensive discovery and negotiations that 

have been undertaken prior to submission of the proposed 

Consent Decree by virtue of the statements and information 

provided to it in a variety of pre-trial hearings during the 

course of the litigation, from those materials, transcripts 

and other pleadings filed with the Court during the course of 

the litigation, and from statements and information provided 

the Court at the hearing of July 17, 1979. The Court finds 

  

 



  
oe 

i 
i 
: 

accordingly that the class of all black residents of Gary, 

Indiana is the appropriately defined affected class, that the 

Consent Decree is reasonable and that the compromise reached 

is fair and just to all members of the affected class and other 

members of the public in general affected thereby. 

THEREFORE THE COURT FINDS that the Consent Decree is 

fair, reasonable and just and adequately protects the rights 

of ‘the 'affected class and is in the interest of the 

plaintiffs, the class members, Methodist Hospital, State of 

Indiana, Department of Health, Education and Welfare and - the 

general public. The Court concludes that while there has been 

one objection to the proposed Consent Decree, the proposed 

Consent Decree reflects a fair and just settlement of these 

actions, that it should be entered as proposed to the Court, 

and that all objections ‘presented to the Court should be and 

are hereby denied. The proposed Consent Decree will be hereby 

entered upon htdseneat lon to this Court. 

Enter this 17th day of July, 1979. 

  

PHIL M. MCNAGNY, JUDGE 
UNITED STATES DISTRICT COURT 
NORTHERN DISTRICT OF INDIANA 

  

 



e » 
PROOF OF PUBLICATION 

STATE OF INDIANA 
‘ SS: 

: r a r : 

COUNTY OF LAKE conic L. COCHRAN 

Before a notary public, this day personally came 

who being duly sworn, according to law, says he 1s 

POST-TRIBUNE, a-daily newspaper, published at Gary, 1in said County and State and 

that the notice of which the annexed 1s a true copy, Was published in said paper. 

On 

On 

NOTARY PUBLIC 

X 

  

ob oF 
APPENDIX A hl 

il”  



  

* MOTICE OF PROPOSED 
SETTLEMENT CONSENT ! 
DECREE AND MEARING 

In the United States District Court 
for the Northern District of Indiona 

Hommond Division 
Covuse No. H 76-273 

BERNICE TERRY, ET AL, 
Plainiitfs VS. METHODIST HOSPI- 
TAL OF GARY, INC., An Indiona 
Not For Profit Corporation, ond JO- 
SEPH CALIFANO, as United Stotes 
Secretary of Health, Education ond 
Welfare, Defendants 

Couse No. KH 77-154 

RICHARD GORDON HATCHER, 
WILLIE LEE PAGE, METRO 
CORPS OF GARY, INC,, A Not-For 
Profit Corporation and others simi- 
tarly situcted, Plaintiffs VS. METH- 

ODIST HOSPITAL OF GARY, INC, 
An Indiona Not-For-Profit Corpor- 
poration and DENIS E. RIBORDY, 
os President of the Boord of Direc- 
tors, JOSEPH CALIFANO, as Unit- 

ed States Secretary of Health, Edu- 
cotion ond Welfare, WILLIAM T. 
PAYNTER, M.D., as State Health 
Commissioner for the Indiona State 
Board of Heolth, JAMES WHITE, 
as Director of the Division of Mospi- 
tal ond Institutional Services of the 

indiana State Boord of Meolth, 
DAVID J. EDWARDS, M.D., os Di- 
rector of the Health Focilities, Serv- 
ices and Review Development Bu- 
reou of the Indiona State Boord of 
Heolth, Defendants. 
TO: All Block Residents of Gory, 
Indiana 
PLEASE READ THIS NOTICE 

CAREFULLY 
A proposed seftiement has been 

reached in the obove-coptioned ac- 
tions with respect to Methodist Hos- 

pital of Gory, Inc. ond incorporated 
in a proposed Consent Decree which 
has been submitted to this Court for 
Hts consideration ond opproval. The 
proposed Consent Decree has been 
opproved by all of the attorneys of 
record for the plointiffs and defend- 

l The puis of this Nolice 5 in 

} onnounce the proposed entry of the 
Consent Decree to oll Block resi: 
dents of Gory, Indiana 08 members 
of the oftec'~d closs defined in the 
Decree and to other persons who 
may be affected by entry of the 

Decree. This Notice is not intended 
to vary any of the terms of the 

proposed Consent Decree. A copy of 
IF the proposed Consent! Decree Is on 

file with this Court and is ovailoble 

for examination in the office of the 
Clerk of the Court on the 1s! Floor 

| of the Federal Office Building, 507 

State Street, Hammond, Indiana 
46320, ond In the Clerk's Office of 
City Moll, 401 Broodway, Gary, In- 
diana. 

Civil Action No. H 76-373 wos 
» commenced in December of 1976, 
by Bernice Terry, Rosa Keelon, 

Borbara Leek Wesson ond Eddie 
Gray against Methodist Hospital of   

  

¢ 

Gary, Inc. ond Dovid Mathews os 
Secretary ol the Department of 
Health, Education ond Welfare os a 
rlass oction. Civil Action No. H 77- 

"154 wos commenced in May of 1977, 
by Richard Gordon Hatcher, Metro 

Corps of Gory, Inc. ond Willle Lee 
Poge ogoinst Methodist Hospital of 
Gary, Inc., Denis E. Ribordy, as 
President of the Board of Directors 
of Methodist Hospital of Gary, Inc. 
(hereinafter collectively referred to 

as the Hospital), Joseph Colifang, 
os Secretory of the Department df 
Health, Education and Welfare 
{hereinafter referred to as HEW), 
willlom T. Paynter, M.D., as Indi- 
ona State Heolth Commissioner, 
Jomes White, as Director of the 
Division of Hospital ond Institution- 
al Services of the Indiana State 
Board of Health, and David J. Ed- 
wards, M.D., as Director of the 

+ Health Facilities, Services and Re- 
view Developmen! Bureau of the 
indiana State Board of Health 

(hereinafter collectively referred to 
as the “State of Indiona™) as a 

class oction. 
These actions subsequently were 

consolidoted by the Court, and ore 
class actions alleging racial dis- 
crimination in the provision of 
health care ond heolth facilities af 
Gory Methodist Hospital and Broad- 
way Methodist Hospital by the de- 
fendants in violation of Title Vi of 

the Civil Rights Act of 1964, os 
ommended, the Fifth and Fourteenth 
Amendments to the United States 
Constitution and various other civil 
rights statutes, regulations, rules 
ond ossurances. 

By Order dated December 7, 1977, 
this Court determined that the cases 
be maointained as a class oction on 
behalf of a class of all Block resi- 
dents of the City of Gary, Indiana. 
The offected class Is so defined In 

the proposed Consent Decree. 
The plaintiffs and defendants, by 

their attorneys. have made a thor- 
ough and detolled Investigation of 
the focts and circumstances In 
volved in these octions and hove 

conducted extensive discovery by 
vorious meons, Including oral ex: 
aminations by deposition, written 
interrogatories, ond examination of 
voluminous documents ond records 
concerning the parties ond issues 
involved in these octions. After tak. 
ing into account the likelihood that 
this litigation, if not settled now, 
will be protrocted ond extensive, 
involving many questions of low 
ond foct ond potential time-consum- 
ing ond expensive oppeals, counsel 
for oll porties concluded thot it 
would be in the best interests of the 
plaintiffs, the offected class and 
eoch member thereof, ond the de- 
fendants to settle these octions on 
the terms of -the proposed settie- 

ment which are Incorporated in the 
proposed Consent Decree. 

Neither Methodist Hospital nor 
HEW nor Stole of Indiona hove od- 
mitted, nor has this Court deter- 
mined, thot there has been ony vio- 

' fotion by ony of the defendonts of 
ony of the cbove-nomed statutes or 

ony other law, rule, assurance or 
regulation, or thot ony of the de- 
fendants odmit liability for ony al- 
leged Injuries suffered by ony ploin- 
tiff. 
PLEASE TAKE NOTICE THAT 

pursuant to on Order of the United 
States District Court for the North- 
ern District of Indiono doted June 
8, 1979, o hearing will be held in the 
above-captioned coses In the Court 
of the Hon, PhIl McNagny, Jr, 
United Stotes District Court for the 
Northern District of Indiona, Ham- 
mond Division, Federol Building, 
507 Stole Street, Hommond, (ndi- 
ona, af 3:00 p.m, on July 17, 1979, 
(hereinafter referred to os ‘‘Heor- 

ing''), to determine (1) the fairness, 
reosonableness ond adequacy of the 
proposed Consent Decree; (2) 
whether the offected closs os de- 

the prior orders of 103 Loury, 

1 Court's opproval of the pro- 
consent Decree shall be finol, 

Q n the entry of the Consent 
1% ond expiration of the time 
limit for appeol therefrom, all de- 

tendants sholl be released, without 
turther oct by any person, agency 
or entity trom any and all liobllity, 
claims, ond causes of oction, loint 
or several, arising (1) from olleged 
octs ond proctices of discrimination 
by the defendant Methodist Hospital 
which properly ore within the scope 

"of the complaints herein, and to 
which the Consent Decree Is direct- 
ed to the date of the entry of the 
Decree, ond (2) from olleged past, 
present or future effects of ony such 

octs and proctices, ond (3) from the 
present or future effects of Any acts 
and prociices required or author- 
ized by or defined in the proposed 
Consent Decree. This release does 
not affect future octions or inactions 
by Methodist Hospital of Gary, Inc., 
the United States Department of 
Heolth, Education ond Welfare, or 
the Indiong State Board of Health, 

except for octs In sotistaction or 
performance of the Consent Decree, 

The Issuance of this Notice shall 

not affect any Issue In these actions, 
until and unless the Court approves 
the proposed Consent Decree, ond 
then only In occordance with the 
Consent Decree. In the event this 

Court approves the proposed Con- 
sent Decree, the Decree will be 

entered immediately. 
For a more detalled statement of 

the matters involved in these oc- 
fions and the proposed Consent De- 
cree, you are referred to the plead- 

ings, the proposed Consent Decree, 
ond to the other papers on file in 

these actions, all of which may be 
inspected ot the office of the Clerk 
of the United States District Court 
for the Northern District of Indiona, 
1st Floor, 507 Stote Street, Hom- 
mond, Indiana, during the business 
hours of the Court. 
THE PROPOSED SETTLEMENT 
The following is 6 summary of the 

main provisions of the proposed 
Consent Decree: 

1. Thé following building pro- 
grams will be undertoken at Gary 
Methodist Hospital: Medical Serv- 
ices Building (on the west side of 
the hospital) to contain 0 new Surgi- 

cal Suite, Intensive ond Coronary 
Care Unit, Central Supply, and 

Emergency Room, This building 
will be constructed so os not fo 
preclude horizontal expansion, A 
twenty-four (24) hour pharmacy will 
be available. 

Remodeling, including on areo to 
house a Family Proctice Residency 
Program (sald orea to be approved 
by the American Acodemy of Fami- 
ly Proctice), provision of an ode- 

quale power plont, refurbishing La. 
bor ond Obstetrical Department; re- 

modeling the Nuclear Medicine De- 
partment; remodeling to provide an 
Auditorium; provide secure parking 

oreas; remodeling areas for ambu- 
latory core clinics; establishment of 
an Intermediote Cordioc Care Unit, 
Stress Testing ond Cardiac Rehabil. 
itation Loboratory, and steps fo 
bring the hospital Into compliance 
with the Life Sofety Code of 1973. In 
oddition, a loundry focility for both 
the Gory and Broodwaoy sites of 
Methodist Hospital will be con- 
structed In or near the hospital. A 
site will be provided by the City of 
Gory, If necessary, 

This bulliding progrom is to be 
financed by o federally guaranteed 

loon and interest subsidy, ond by 
other privote financing. y 

2. The following bullding pro- 
grams will be undertoken af Brood- 
woy Methodist Hospital: A Health 

Services Building, ond o 105 bed 
addition. This building program will 
be finonced by private financing, 

J. The bullding programs will be 
commenced on 0 substontially iden 
tical chronological 

of the programs will be jointly mon- 
Itored by the parties. 

4. The occuponcy rote ot the Gory 
focllity will be maointoined at on 
efficient level including urging po- 
tients opplying at the Broodway fo- 
cllity to 00 to the Gary focllity 

rather than be ploced on 0 walling 
list. Efforts will be mode to further 
integrate the staffs ond patient cen- 
sus at both focllities. Furthermore, 
the Hospital shall provide cdequote 
ond comparable doctors’ coveroge 
in the Emergency Room Including 
the avallobility of stoff specialists 
for consultation at both sites. Addi. 
tionolly the Hospital will ensure 
thot oll nursing shifts ore odequate- 
ly covered ot both facilities. Compo- 
rable medicol education of staff and 
patients will 
facilities. 

S, Ambulatory care services will 

bosis. Progress 

be provided af both _ 

‘Ing progroms; 

The MHoseita! will develcr 

Long Ronge Plon for beth Hospi 

by December, 1978, to be opprove 
for civil rights purposes by HEW 
ond attorneys for the plaintiffs, Th 

long ronge plon will Include but ne 
be limited to; Improving and mod 
ernizing the Loboratory, Rodlology, 

ond Pedlotrics Departments of 
Gary Methodist, ventilation of the 
Obstetrics Departmen! ot Gor: 
Methodist and central alr condition 
ing In portions of Gory Methodist 
HEW Is not precluded from requir 

ing additional commitments and re 
sources from Methodist Hospito 
thot it requires of oll other Hospi 

fals In Loke County nor from re 
quiring any Joint plonning It re 
guires of ony other Hospitals !n 
Lake County, indiana, 

13. The Civil Rights Assurances 
signed by Methodist Hospital on 

July 27, 1973, ore Incorporated into 
the settlement ogreement, 

14. The State of Indiana will take 
steps to focllitate the finoncing of 
the Gary focllity construction; wil 
not oppose ony of the bullding pro 

grams; and, will decline to review 
the building projects except for the 
105 bed addition, uncer $.1122 of the 

Social Security Act, 
15. HEW willl revise Assuronce 

Number 3 of certain Civil Rights 
Assurances signed by the Hospital 
ond HEW on July 27, 1973, expedi- 
tiously complete Its county wide 
hospital civil rights Review; take 
steps to facllitote the finoncing of 
the Gary facility bullding project; 
and, ogree tha! the bullding pro 
grams outlined herein do not consti 
tute a violation ‘of Title VI of the 
Civil Rights Act or the July 27, 1973 | 
Civil Rights Assuronces, HEW fur- 
ther agreed not to toke or support 

any other action, edministrative or 
otherwise, bosed upon olleged civil 
rights violations which have been 
alleged or are within the scope of 
the Complaints filed In the suits. 

16. The plointifts will not oppose 
ony of the bullding programs. May- | 
or Richard Gordon Hatcher will 
make good faith efforts to supply 

odditional lighting ond security 
forces at the Gary foclility; partici- 

pate In efforts to secure public 
transportation between the Garv 
ond Merrillville foclilities; make 

available the City's powers of emi- 
nent domain to focllitate the build- 

and, provide the 
Hospital with a 2 to J acre site on 
which to construct the loundry, if 

necessary, ° 
If you have ony questions con 

cerning this Notice, any of the mat. 
fers discussed In this Notice, or the 
proposed seftlemen! or proposec 
Consent Decree, you may contact: 
ATTORNEYS FOR PLAINTIFFS 
Beth J. Lief, N.AAC.P. Lega! 

Defense Fund, 10 Columbus Circle, 
Suite 2030, New York, New York 
10019. Telephone number 212-584. 
8397, ond; 

Julion ‘Allen, 2009 Broadway, 
Gary, Indlono 46402, Telephone 
number 219-884-3644, 

Attorneys for plaintiffs and the 

closs of all Block residents of Gary, 
Indiana. If ony Black residents of 
Gary hove any questions concerning | 

this Notice, he or she should contoct | 
the attorneys tor plaintiffs persons 
may contact Beth J, Lief by calling 
cotlect). | 

Any ofher Individuals having in-} 
quiries concerning this notice may | 
contact ottorneys for the plaintifis | 
or the oftorneys of record listed ! 
below. ! 
ATTORNEYS FOR METHODIST 
HOSPITAL OF GARY, INC. AND \ 

DENIS E. RIBORDY, AS i 
PRESIDENT OF THE BOARD OF | 

- DIRECTORS i 
Bruce E. Sovers ond Edword J. | 

Hussey, Hodges, Davis, Gruenberg, | 
Compton & Savers, $525 Broodwoy, | 
Gary, Indiona 46410, Telephore | 
number 219-981.2557; ! 
Raymond - J. Kelly, Sevfarth, 

"Show, Fairweother & Geraldson, 55 
Eost Monroe Street, Chicago, Illi 
nols 40603. Telephone number 312+ 
344-8000. 

Attorneys for defendonts, Method- 
Ist Hospital of Gary, Inc. ond Denis 
E. Ribordy, as President of the 
Board of Directors. 

ATTORNEYS FOR H.E.W, 
Rebecca L. Ross, Deportment of 

Justice, 10th ond Pennsylvonio Ave- 
nve, N.W., Washington, D.C. Tele: 
phone number 202.739.2230; | 

Albert Homlin, Assistont General 
Counsel, Civil Rights Division, Of- 
fice of General Counsel, Depart. 
ment of Nealth, Education ond Wel- 
fore, 330 Independence Avenue, 
$.W.. Woshinglon, D.C. Telephone 
number 202-245-7737; 

Jeftrey Chompogne, Attorney, Of- 
fice of General Counsel, Civil Rights 

Nanartmant af Menlth Fe Niviction 

 



[dS 

}oworloUls, mec including oro! ex. 12100y core clinics, er ent of 
orminctii by deposition, written on Inlermediote Cordioc Core Unit, 

InterropofByles, ond exominotion of SIf sting ond Cordioc Rehobll. 
Injerresa AL uments and records 110 pborotory, ond steps fo 
concerning they parties ond Issues bri hospltal Into complionce 
involved in thes&octions, After tok. with the Life Sofety Code of 1973. In 

lng Into account tha likelihood thot oddlition, a loundry ftocility for both 
this litiootion, If nbd, settled now, the Gory ond Broodway sites of 
will be proirocied © extensive, Methodist Hospital will be con- 
Involving mony aursifieg of law strucied In or near the hospitol, A 
ond foc! ond polentiol fim sum- site will be provided by the City of 

. Ing ond expensive oppeals, taynsel Gory, i necessary, . 
for all parties concluded thug it This bullding proprom Is to be 
would be In the bes! interests of financed by o federally guoronteed 
plointifts, the affected closs ond loan ond interes! subsiay, ond by 

.eoch member thereof, ond the de- 
. fendants to settle these octlions on 

the terms of the proposed settle- 

men! which are Incorporated in the 

proposed Consent Decree. 
Neither Methodis! Hospital nor 

HEW nor Stale of Indiono hove od- be finonced' 
mitted, nor has this Court deter- 3. The bull 
mined, thot there has been ony vie- commenced on 

“lotion by ony of the delendonts of tical chronolopieiric . Progress 
ony of the obove-nomed statutes or of the progro Jointly mon- 
ony other low, rule, assuronce or 

- regulation, or that ony of the de the Gary 
fendonts odmit liobllity for ony ol- / i be ointoiniy at on 

leped injuries suffered by ony plain- level including urging PO 
tH. ti “opplying at the Broodwoit fo- 

Gory, 

number /.9-A% ead 
Allorneys flor 

this Notice, he ogs 
the ottornevs plointitfs (person 
moy confoclAeth J, Lief by coliir 

collect), : 
Any Individuols bhoving ir 

quiriesdconcerning this nolice mc 
conte! ottorneys for the plaintif 

he oftorneys of record liste 
Hallow. 
ATTORNEYS FOR METHODIST 
HOSPITAL OF GARY, INC. ANT 

DENIS E. RIBORDY, AS 
PRESIDENT OF THE BOARD OF 

~ DIRECTORS 
Bruce E. Sovers ond Edword 

Hussey, Hodpes, Dovls, Gruenbers 

_numbaer 219-781-2857; 
Raymond. J. Kelly, Sevlarth, 

"Show, Fairweather & Geraldson, §% 
Eos! Monroe Street, Chicago, Illi 

nols 60601. Telephone number 12 
344-8000. 

Attorneys tor defendonts, Method 

Ist Hospital of Gary, Inc. ond Denis PLEA NOT H fy to oo to the G LEASE TAKE OTICE THAT ary foc XX. E. Ribordy, os Presicent of the 
‘other than be placed on a wollindh 

Boord of Directors, 
ATTORNEYS FOR H.E.W, 

fist. Efforts will be mode to further 
integrate the staffs ond patien! cen. 
sus of both focilities. Furthermore, 
the Hospital shall provide odeaucte 

ond comparable doctors’ coveroge 
in the Emergency Room including 
the ovollablilty of stoff speciolists 
for consultation ot both sites. Addi. 
tionally the Hosplitol willl ensure 
tha! all nursing shifts ore odegquate- 
ly covered ot both tocilities. Compo- 
rable medicol educotion of staff and 

patients will be provided at both 
Decree; (2) focilities. 

‘er the offected class as Oe 5, Ambulatory core services willl 
in the proposed nade Be be - a Gory facility 

rs Sie mia eisfacdan fl Fo pelt min “to RE v iy 
- ment ond proposed lili re. of the ombulatory core services as 
upon persons who ore no! members well as the Family Proclice Resi. 

of the offected class; ond (4) wheth- dency program, Methodist Hospltal 
er the proposed Consent Decree Will continue to serve patients who 
should be approved finally by the oppeor of the Emergency Room of 
Court. The Heoting may be ad- Gory Methodist Hospital. Any new 

journed from time to time by the Services provided by the Hospital 

Court a! the Hearing or ot ony Will be ploced at the Gory facility 
odiourned session thereof without unless such placement would be in- 
further notice. : consistent with good hospital man- 

This Notice is given to you In the ' agement principles. Furthermore, 

belief that you are, were, or may be Prior lo plocing ony new clinics af 
o member of the offected class, or 
thot your rights may be offected by cemonsiroted to HEW's Office for 
these octions or the proceedings de- Civil Rights of Region V that there 

: scribed In this Notice. Is a0 need for such o clinic of the 

This Notice is no! an expression Broodwoy focllity ond that there 

* of ony opinion by this Court as to ore odequale hours ond stoffing of 
the merits of or the defenses in the clinics of the Gary fociiity. 
these actions, but Is solely to inform é. Future purchases of equipment’ 

. you of the pendency of these octions sholl be mode on on eguitoble basis 
. ond of the proposed settlement ond between facilities ond ony purchase 
proposed Consent Decree so that of eaulpment costing over $100,- 

! you may decide what steps you 000.00 shall be approved for civil! 

| wish to toke in relotion to these rights purposes by HEW's Office for 
lowsvlts ond the proposed Consent Civil Rights of Region V. * 
Decree. 7. Dally tronsportation services af 

The Consent Decree entered shall no charge will be developed by o 

. Include and bind oll members of the consultant between the Gory focility 
' oftected closs, whether or not they ond the Broodway focility for am- 

loin or Intervene In these octions. bulatory patients and hoseltal stoff 
If you are satisfied with the pro- 90ing to ond from work. In oddition, 

posed Consent Decree or If you the parties coree to work to obtain 
have no objection to It, you need not Public lransportation between the 

' oppeor at the Hearing referred to In focllities, 
this Notice. 8. The Board of ‘Directors of 

Any person who Is dissotisfied Methodist Hospital will be restruc- 
with the proposed settlemen! or pro- fured to ensure representation on 

posed Consent Decree may oppeor the Board ond on all committees of 
-gt the Hearing In person -or with the Board of members of minority 
counsel ond show couse, if there be oroups In Gary ond the hondi- 
ony, why the proposed offecled copped and minority groups In the 
class should not be defined os obove Patient population at both focilities 
described, or why the proposed sel- by 1981. Al least one-third of the 
tiement ond the proposed Consent members of the Board of Directors 

Decree should no! be opproved. shall be members of minority 
Such oblections olso moy be mode 97OUPS. 

In writing by malling or delivering f. Methodist Hospital will moke 

o written statement of the oblec- reosonable efforts to obtain residen- 
tions to the Clerk of the United cles at Gory Methodist in Internal 

Stoles District Court tor the North- Medicine, ond Obstetrics ond Gyne- 
ern District of Indiona, 1st Floor, cology. 
Federal Office Building, 507 State 10. The orthovollope x-roy mo- 
Street, Hommond, Indiono 46320, by| chine al Gory Methodist will be 

.§:00 p.m., on July 11th, 1979. If such, operaled of least two (2) oHernoons 
written objections ore mode, the) Per week ond such service will con- 

person .making such oblections]| tinue unless It is unfeasible. 
should appeor ao! the Heoring. Any| 11. The Hospital will report In a 
closs member ond ony person who | coded system on 0 semli-onnual bo- 

Is or may be affected by the pro-.3is to HEW concerning coded po- 
posed settlement, the proposed Con-'flent dovs af eoch focility by roca,’ 
sent Decree and the prior orders of Glagnosis, lp code, ond roce ond 

this Court, who do not moke oblec- coded number of physiclon; con 
tions In the manner provided herein cerning staff, overtime, equipment 

shall be deemed to hove wolved Purchoses over 310.000.00 ond new 
such obieclions ond shall be fore services; efforts ol recruliment of 
‘closed forever from moking ony stoff ond utllizotion of the tronspor- 
such obleciiom, by opeeal or ether. otlon system will be provided 

wise, to the proposed settlement, HEW, This information Is to be 

h - RE . - I - 
  

ebecco L. Ross, Deporiment of 
Jus » 10th ond Pennsylvania Ave 

nus, +» Washington, D.C. Tele 
phone number 202-739-2230; 

lin, Assiston! Genero! 

Rights Division, Of- 
Counsel, Depart- 

ment of Heolth, ation ond Wel- 

fore, 330 IndepeNgence Avenue, 
»-W.. Woshington, Telephone 
number 202-245-7737; 

Jetirey Chompogne, A 
- fice of General Counsel, 
Division, Deportmen! of Heol 

ucation ond Waelfore, 330 Inde 

Peta’ WH. Telephone num 
245-7737, 

Attorneys for Joseph Califone, 
United Stotes Secretory of Health, 

Educotion ond Weltore, 
ATTORNEYS FOR THE STATE OF 

INDIANA 
Theodore L. Sendak, Attorney 

General of the State of Indiona; 
Eric B. Servoos, Deputy Attorney 

General, 219 Stole Mouse, Indianap- 
olis, Indiono 46204. Telephone NUM- 

the. Broodwoy facility, it must be Der 317-633-5512, 
AHorneys tor the State of Indiona. 

Dated this 8th day of June, 1979. 
IL M. MCNAGNY, JR. Judoe 

United Stoles District Court 
‘a2; 19 P.T. 6152 
  

 



. by Btlate noe. . Accounts 

  

   .. Methodist Hospital.Qq Marys TOs i i To..info,. o es ie A TR A ear Dr. 
(Governmental Unit) 

DRE i ede County, Indiana iPeO.. Pox NM 587 TR I L 6401 ran ve Ae ya 

PUBLISHER'S CLAIM 

LINE COUNT 

Display Matter (Must not exceed two actual lines, neither of which shall total 
more :han four solid lines of the type in which the body of the advertisement 
is: set) number of equivalent lines ~~ cee ean TT RIE 5 ee le 2 es sn sine wn wa aed 

Head--pumberol lines dein Ranma ake fal FU BEB he Ope SER Ee yy mia aia le i we 

Body-~numberof lines © igs yochianned  BERG  S aBa POI ERE CI GT ATS RL eee dee welsmain ens 

Patl—pumber of Hines = «0 nina tail ve Loa ia Bi Sa hs ss Ee Ne Sei SRE SR nae ete a we iee ae 

Total number of lines in notice 993 cei La   

COMPUTATION OF CHARGES 

  

217.28 

(50 percent of above. amornut) imi Se RRS BE RITSS El CT el SR Pe SE MRE a Sawsssanunvn saad 

Charge for extra proofs of publication 

{50 cents for each proofin excess of IWOY 5 ha. Cis Tose he ame SE TTR ee SS SE DUE sess ase snes nes 

TOTAL AMOUNT OF CLAIM 217.28 inne 
  

(D Vewien ¥ Meict 
DATA FOR COMPUTING COST 

Width of single column 10%. ..ems Size of type Fs ...point 

Number of insertions ..... 2. Size of quad upon which type is cast ........ 

  
  = 

Pursuant to the provisions and penalties of Ch. 155, Acts 1953, 

I hereby certify that the foregoing account is just and correct, that the amount claimed is legally due, after allowing all 

just credits, and that no part of tLe same has been paid. 

  

ssc essen 

PUBLISHER'S AFFIDAVIT 

oo 1 Tigges 
1 io C l. Personally appeared before me, a notary public in and for sald county and state, 

undersigned. ... Imogene, Ene Take SR who, 

~ i . 

4- 3) 7, being duly sworn, says that S.he is... Bditor i ey i ae ns wn» Wn eee 

|= 1 k 
0) ofthe. ALO, i iis es vans a weekly =. 

< ln, newspaper of general circulation printed and published in the English language in the 

ATTACH COPY OF G $ 

ADVERTISEMENT (city) town of... BAY sh sits sina avs tits vais in state and county 

HERE aforesaid, and that the printed matter attached hereto is a true copy, which was duly 

APPENDIX B 

  

  

 



i = 
  14—INFO tho ff June 14,1979 

: 

    

* NOTICE OF PROPOSED 
o member of the affected class, Of services kd by the Hospitol D.C. 20201. Telephone number 202 

SETTLEMENT CONSENT 
that your rights may be affected bY will be ploc ot the Gory facility 245-7737. 

is 

DECREE AND HEARING 
these actions or the proceedings 0¢ unless such plocement would be in- Attorneys for Joseph Califono, 

in the United States District Court scribed In this Notice. 
consistent with good hospital mon- United Stoles Secretary of Heolth, 

for the Northern District of Indiana 
This Notice Is not on expression 

ogement principles. Furthermore, 
Education ond welfore. 

Hammond Division 
of any opinion by this Court os 10 prior to placing ony new clinics at ATTORNEYS FOR THE STATE OF 

Cause No. H 76-373 
the merits of or the defenses In the Broadway facility, It must be 

INDIANA °° 

BERNICE TERRY, ET AL. these actions, but Is solely to inform demonstrated to HEW's Office for Theodore L. Sendok, Attorney 

Plaintiffs VS. METHODIST HOSPI- you of the pendency of these actions Civil Rights of Region V that there General of the State of Indlona; 

i TAL OF GARY, INC.. An Indiona ond of the proposed settlement and is o need for such © clinic at the Eric B. Servoas, Depuly Attorney 

Not For Profit Corporation, and JO- proposed Consent Decres so that Broodway focility ond thot there General, 219 State House, Indianap- 

SEPH CALIFANO, os United Stales you may decide what steps YOU ore adequole hours ond stoffing ot olis, Indlona 46204, Telephone num- 

‘ Secretgry of Health, Education ond wish to take in relation fo these the clinics at the Gary facility. 
ber 317-633-5512. 

' Weltore, Defendonts 
lowsuits ond the proposed Consent 6. Future purchases of eauipment 

Attorneys for the State of Indiana. 

Couse No. H 77-154 3 Decree. 
shall be made on an equitable basis Dated this 8th day of June, 1979. 

RICHARD GORDON HATCHER 
The Consent Decree entered shall between facilities ond any purchase PHIL M. MCNAGNY, JR. Judee 

WILLIE LEE PAGE, METRO include ond bind oll members of the of equipment costing over $100, United States District Court 

CORPS OF GARY, INC., A Not-For otiected class. whether or not they 000.00 shall be approved for civil 
. 

Profit Corporation and others simi- join or intervene in these octions. . rights purposes by HEW's Office for | 6-14,21,1979-Info 

tarly situated. Plaintiffs VS. ME TH- if you ore satisfied with the pro- Civil Rights of Reglon V. \ ee evitpemestammest Stuy Te RE 

ODIST HOSPITAL OF GARY, INC., posed Consent Decree or if you 7. Dally transportation services of A 

.An Indiana Not-For-Profit Corpor- hove no obiection to it, you need not no charge will be developed by @ 

poration ond DENIS E. RIBORDY, oppear af the Hearing referred to i consultant between the Gory facility | 

os President of the Boord of Direc- this Notice. 
g _ + and the Broadway focility for om- 

tors, JOSEPH CALIFANO, os Unit- Any person who Is dissatisfied bolatory patients ond hoseltal statf 

ed States Secretary of Heolih, Edu- with the proposed settlement of Pro- ~ going to ond from work. In addition, 

cation ond Welfare, WILLIAM T. posed Consent Decree may oppeor the parties ogree to work Io obtain 

PAYNTER, M.D., os Stale Health ot the Hearing In person -of with public transporiation between the 

Commissioner for the Indlano State counsel and show couse, if there be focilities. ™ 

Boord of Heclth, JAMES WHITE, ony, why the proposed affected 3. The Boord of Directors of 

as Director of the Division of Hospi- class should not be defined as obove Methodist Hospital will be restruc 

tol ond institutional Services of the described, or why the proposed sel: tured to ensure representation on 

indiana State Board of Health, tlement ond the proposed Consent the Board and on oll committees of 

DAVID J. EDWARDS, M.D., as Di- Decree should no! be approved. the Board of members of minority 

A yector of Health Focllities, Serv such obiections olso may be mode groups In Gory and the hondi- 

4 ices an | Review Daveicament By in writing by malling of delivering copped ond minority groups in the 

cy Yeo of NE og State Board of o writien statement of the oblec: peters populate of both focitities | 

wih 
tions to the Clerk of the United \4 . At leas! one-third of the 

Jo. 2 Block Residents of Gor. States District Court for fhe North members of the Board of Directors | 

ern Distri Indiona, 1st Floor. sho members of minority 

PLEASE READ THIS NOTICE eral Office Building, 507 State Proves. 

A proposed settlement has been ~ Street, Hammond, indian 446320, by 9. Methodist Hospital will make 

reached in the above-captioned oc- 5:00 p.m., on July 11th, 1979. If such reasonable efforts to obtcin residen- | 

tions with respect to Methodist Hos written obiections ore mode, the cles ot Gary Methodist in Internal | 

pital of Gory, inc. end incorporated 
person .moking such objections 

Medicine, and Obstetrics and Gyne- 

In a proposed Consent Decree which should cpeear of the Heoring. AnY cology. 

hos been submitted to this Court for class member ond any person who 10. The orthovoltoge x-ray mo 

irs consideration ond opprovol. The ls or may be offected by the pro" - chine of Gory Methodist will be 

proposed Consent Decree has been posed settlement, the pr Con- operated at least two (2) afternoons 

oproved by ail of the attorneys of sent Decree ond the prior orders of per week and such service will con 

record for the plointits ond defend- this Court, who do not moke oblec tinve unless it Is unfeasible. 
| 

onts named hefein. 
: _tions in the manner provided herein 11. The Hospital will report In a! 

. The purpose of this Notice Is fo. shall be deemed to hove waolved coded system on © semi-annual bo- 

onnaynce the proposed entry of the such oblections and shall be tore- sis to HEW concerning coded PO | 

Consent Decree fo oll Block resi closed forever from making ony 3 tient doys at eoch tocility by race, 

Te dents of Gory. Indiono as members such objections, by oppeal or other: diagnosis, ip code, ond race ond 

of the offected closs defined in the wise; to the proposed settlement, coded number of physicion; com 

! \ Decree ond to other persons who the proposed Consent “Decree and cerning stati, overtime. equipment 

may be offected by entry of the the prior orders of this Court. . purchases over $10,000.00 ond new 

Decree. This Notice is nol intended This Court's approval of the eres services; efforts of recruitment of 

to vory ony of the terms of the posed Consent Decree shall be final. staff and utilization of the transpor- 

proposed Consent Decree. A copy of and upon the entry of the Consent jaotion system will be provided to 

the proposed Consent Decree Is on Decree ond expiration of the time MEW. This information is to be 

file with this Court ond Is available limit for oppeal therefrom. oll de- used solely to assist in monitoring | 

= for examination in the office of the ~~ fendonts shall be released. without 
the Consent Decree. 

Clerk of the Court on the 1st Floor further oct by ony person. agency , 12. The Hospital will develop O 

4 
of the Federal Office Building. 507 or entity from any ond oll Habllity, 

Long Ronge Plon for both Hospitals | 

state Street, Hommond, Indiana claims, ond causes of oction, loint by December, 1978, to be wpproved | 

46320, ond In the Clerk's Office of or several, orising (1) from olieped 
for civil rights purposes bY HEW 

City Hall, 401 Broadway, Gory, in octs and practices of discrimination 
and attorneys tof the plointifts. The | 

diona. 
: «by the defendant Methodist Hospital 

long ronge plan will include but not | 

Civil Action No. H 76-373 wos which properly ore within the scope y be limited to: improving ond mod- 

commenced In December of 1976, of the complaints herein, ond fo ernizing the Laboratory, Rodiology. 

: 
py Bernice Terry. Rosa Keelon, which the Consent Decree is direct- 

and Pediatrics Departments 
atl 

Barbora Leek Wesson ond Eddie ed to the date of the entry of the Gory Methodist, ventilation of the 

Groy against Methodist Hospital of Decree, ond (2) trom alleged past, Obstetrics Department af Gary 

Gary, nC. ond David Mathews OS present or future effects of ony such. Methodist and centrol oir condition- 

secretary of the Department of octs and practices, and (3) from the ing In poriions of Gory Methodist. 

Health, Education ond Welfare as © present or future effects of ony acts HEW is nol precluded from requir: 

class action. Civil Action No. H 77- ond practices required or outhor- ing odditional commitments and re- 

154 was commenced In May of 1977, {zed by or defined In the proposed 
sources from Methodist Hospital 

py Richard Gordon Halcher, Metro Consent Decree. This release does - that It requires of oll other Hospl- 

Corps of Gary, InC. ond Willie Lee not otfect future octlons or inactions tols In Lake County nor from re- 

Poge ogoinst Methodist Hospital of by Methodist Hospital dbf Gory. Inco, quiring _ ony lola! plonning 11 re; 

Gory, InC. Denis E. Ribordy, 03% the United States Department of guires of ony other Hospitals in 

President of the Board of Directors 
Health, Education and Weltore, of . Loke County. indiana. 

of Methodist Hospital of Gary, Inc. the Indiana Stote Board of Health, 13. The Civil Rights Assurances : 

. (hereinafter collectively referred to > except for ocls In satistoction of Sgned by Methodis! Hosplic) on 

os the Hospital), Joseph Collfano, = . performance of the Consent Decree. 
July 27, 1973, are incorporated into | 

.as Secretory of the Deportment of. The issuance of this Notice shall the settlement agreement. 
| 

Health, Education ond Welfore not affect any issue in these actions, 14. The State of Indiono will toke 

- (hereinafier referred to G3 HEW). until ond unless the Court opproves 
steps 10 focilitote the finoncing of ! 

william T. Paynter, M.D., 03 indi- the proposed Consent Decree, ond the Gary facility construction; wilt! 

N ono State Health Commissioner, 
then only in accordonce with the not oppose any of the building pro- 

Jomes White, as Director of the Consent Decree. In the event thie orams; ond, will decline fo review } 

Division of Hospital ond institution 
Court approves the proposed Con the building projects except for the 4 

ol Services of the indiona States sent Decree, the Decree will be 105 bed oddition, under S.1122 of the | 

Board of Health, and Dovid J. Ed- entered immediately. 
er social Security Act. 

| 

words, M.D., 0% Director of the - For o more detoiled statement of v 15. HEW will revise Assuronce 

Heolth Focilities, services and Re- the matiers involved in these aC: Number 3 of certain Civil Rights : 

. view Development Bureov of the tions ond the proposed Consent De- Assurances signed by the Hospltol 

- indiana State Board of Health, e Cree you ore referred to the plead- ond HEW on July 27, 1973. e.lpedi- 

(hereinafter collectively referred 10 Ings. the proposed Consent! Decree, 
tiously complete Its county wide 

os the ‘State of Indiona') @s @ ond to the other papers on file In hospital civil rights Review; toke 

iis -  closs action. 
these actions, all of which may be steps 10 facilitote the finoncing of 

These actions subsequently were inspected at the office of the Clerk the Gary facility building proiect: ~ 

consolidated bY the Court, and ore of the United States District Court ond, agree tha! the building Pro- 

class oclions alleging racial dis- » for the Northern District of Iindiona. groms outlined herein do not consti: 

crimination in the provision of 1st Floor, 507 State Street, Hom-. tule o violation of Title VI] of the 

health core ond: health facilities of mond, Indlona, during the business Civil Rights Act or the July.27, 1973 

- ; Gory Methodist Hospital and Broad: hours of the Court. 
> Civil Rights Assuronces. HEW fur: 

‘ way * Methodist Hospital by the de- THE PROPOSED SETTLEMENT 
ther agreed not to toke or support 

. - fendants in violation of Title V1 of The following is 0 summary of the ony other action, odministrative 
of 

the Civil Rights Act of 1964, O%° moin provisions of the proposed 
otherwise, bosed upon alleged civil 

omended, the Fifth ond Fourteenth 
Consent! Decree: 

E rights violations which have been 

Amendments 10 the United States 1. The following pbuilding pro- alleged or ore within the scope of 

N Constitution ond vorious other civil groms will be undertioken ot Gory _ the Complaints filed in the suits. 

rights stotules. regulations, rules Methodist Hospital: Medical Serv. : 16. The plointlfts will not oppose 

ond assuronces. 
. ices Buiidine (on the west side of ony of the building progroms. May: 

By Order dated December 7, 1977, the hospital) to contain 0 new Surg or Richard Gordon Hotcher will 

this Court determined that the coses col Suite, Intensive ond CoronorY 
moke good ftolth efforts to supply 

be maintained 0S © class action on Core Unit, Central Supply. ond - pdditional lighting ond security 

adeail Block [SH- Emergency Room. This building 
forces ol the Gory tocility; portici- 

Arab On 0. 03.00! 10 pote In efforts to secure public 

" ciation hatween the Gary 

  

  
 



  

[y 

~~ Court. 

pie Fie that you 

    

- tgndants fo 

   

    
     

      

    
    

    

  

   

         
    

    
  
      

  

€ 3501) 

sins! Methodisl Mosniiol of 

Gory, Bovid Mothews os 

Socrelary 
Heolth, EO 
class oction. 
154 wos commenc 

by Richard Gordon 
Corps of Gary, Inc. © 

Poge ogolns! Methodist 

Gary, Inc., Denis E. RI 

President of the Boord of Dir 

of Methodist Hospital of Gory, 

(hereinafter collectively referred t 

os the Hospital), Joseph Colltono, 

.os Secretary of the Deportment of, . 

Health, Educotion ond Welfore 

(hereinafter referred to as HEW), 

williom T. Poynter, M.D., a3 indi-" 

ono: Stote Heolth Commissioner, 

" james White, as Director of the 

Division of Hospital and Institution-- 

ol Services of the indiono .Stotes 

Board of Heolth, ond Dovid J. Ed 

wards. M.D.. as Director of the 

Heolth Foclilities, Services ond Re- 

view Developmen! Bureou of the 

-indiono Siale Board of Health, 
(hereinafter collectively referred to 
as the ‘State of Indiono™) os @ 

closs action. . 

These octions subsequently were 
consolidated by the Courl, ond ore 

closs actions alleging rocial dij 

crimination in the erovisio bf 

health core ond: health focil of 

Gory Methodist Hospital o B rood- 

way Methodist Hospital the de- 

fendonts in violation Title VI of 

the Civil Rights of 1964, os 

omended, the Fil ond Fourteenth 

Amendments the Uniled Stoleg. 

Constitution d vorious other civil 

rights sigfltes, regulations, rules 

ond ost onces. : R 

* BygBroer doled December 7, 1977, 

) ourt delermined that the coses 

nal lol eet] . . 0 

behall of o class of oll Block resi 

dents of the City of Gary, Indionga. 

The offecied closs is so defined in 
the proposed Consent Decree, 

The plointitts and detendants, by 

their aHorneys, hove mode a thor- 

ough and delolled investigation of 

the facts ond circumsionces In- 

volved in these actions ond hove 

conducted extensive discovery by 

various meons, including oral ex- 

ominalions by deposition, written 

interrogatories, and examination of 

voluminous documents and records 

concerning the parties ond Issues 

involved In these octions. AHer tok- 

ing into occount the likelthood thot 

this litigation, if not seftled now, 

wii be protracted and exiensive, 

involving mony questions of low 

ond foct ond potentiol time-consum- 

ing ond expensive appeals, counsel 

dor oll parties concluded thot It 

would be in the best interests of the 

plointiffs, the offected class and 

eoch member thereof, ond the de- 

settle these octions on 

the terms of the proposed settle- 

men! which ore incorporated in the 

proposed Consent Decree. 

Neither Methodist Hospital nor 

HEW nor State of indiono have od- 

mitted, nor has this Court deter 

mined, thot there has been ony vio- 

lation by ony of the defendonts of 

   

  

   
    

     

    

   
    

* any of the obove-nomed statutes or 

any other low, rule, ossuronce of 

regulotion, or that ony of the de- 

fendonts odmlit liabllity for ony al 

- teged injuries sutiered by ony loin 

1H. 
PLEASE TAKE NOTICE THAT 

pursuant to an Order of the United 

siotes District Court for the North 

ern District of Indiana doled June 

8, 1979, a heoring wlll be held In the 

obove-captioned cases In the Court 

of the Hon. McNagny, Jr. 

United Stotes District Court for the 

Northern District of Indiana, Hom- 

mond- Division, Federol Building, 

507 State Strest, Hommond, indi 

ona, of 3:00 p.m. ON July 17, 1979, 

(hereinafter referred to os ‘'Heor- 

Ing"). fo Cetermine (1) the folirness, 

reasonableness and odequocy of the 

proposed Consent Decree: (2) 

whether the affected class os de- 

fined in the proposed Consent De- 

cree Is properly defined ond deter: 

mined; (3) the effects of the settle 
Consent Decree 

of the offected class; ond (4) wheth: - - 

er the proposed Consent. Decree 

should be oppfoved finally by the 

The 

journed from fime to time by the 

Court of the Hearing of ot ony 

odiourned session thereof without 

het notice. i we ‘ 

This Notice Is given to you In the 

ore, wers, of may be 

‘ 
i - 

. For oa more 

Heoring may be od-~ 

Decree, ond | from olleged i=. 

present or tulure effects of any such. 

octs ond practices, ond (3) trom the 
present or future effects of ony ocls 
ond proctices required or outhor: 

jred by or defined In the propo 

Consent Decree. This releose does 

not otfect future octlons or Inactions | 

by Methodist Hospilol df Gory, Inco, 

the Unlled Stotes Department of 

Heolth, Education ond Weltore, Of 

the Indlona Stole Board of Health, 

except for octs In solistoction of 

performonce of the Consenl Decree. 

The Issvonce of this Notice sholl 

ofiect any Issue in these octlof) 

nd unless the Court opprgh 

In occordonce 
in ¢ 

the     

    
    

         

     
   
   

    

sent Jecree will be 

entered Immedlq dy “NS i 

fe 1a a statement of 

the maoller nvolved these ocC- 
tions and e proposed Gensent! De- 

of ore referred to Mag pleod- 
proposed Consen! Dgcree, 

to the other popers on f In 

ese octions, all of which may DB 

inspected ot the office of the Clerk 
of the United States District Court 
for the Northern District of Indiona, 

Ist Floor, 507 Stole Street, Hom- 

mond, 
hours of the Court. 
THE PROPOSED SETTLEMENT 

The following is 0 summory of the 

moin provisions of the proposed 

Consent Decree: 2 

1. The following buliding pro- 

groms will be undericken of Gary 

Methodist Hospital: Medicol Serv- 
ices Bullding tbn the wes! side of 
the hospital) to contain o new Surgi-. 

col Sulte, Intensive and Coronary 

Core Unit, Central Supply, ond 

  

   
   

   

    

will be construc so as nol jo 

preclude horizontal exponsion, A 
twenty-four (24) hour pharmacy will 
be ovuoiloble. i 

Remodeling, Including on oreo fo 
house a Family Proctice Residency 

Progrom (solid oreo lo be approved 

.by the Americon Acodemy of Fomi- 

ly .Proctice), provision of on ode- 

quate power plant, refurbishing Lo- 

bor ond Obstetricol Department. re- 

modeling the Nuclear Medicine De- 

partment; remodeling lo provide on 

Auditorium; provide secure parking 

oreoas; remodeling areas for ambu- 

fotory core clinics; establishment of 

on Intermediate Cordloc Core Unit, 

Stress Testing ond Cordioc Rehdbil- 

itotion Loborotory, ond steps fo 

- bring the hospital Into complionce 

with the Life Safety Code of 1973. In 

oddition, 0 loundry facility for both 

the Gary ond Broodway sites of 
Methodist "Hospital will be con- 
structed in or neor the hospitol. A 
site will be provided by the City of 

Gary, I necessary. i. 

This building progrom Is fo be 

financed by o tederally guaranteed 

loan ond Interest subsidy, and by 
other private finoncing. 

2. The following bullding pro- 

proms will be undertoken of Brood- 

way Methodist Hospitol: A Heolth 

Services Buliding, ond o 105 bed 

oddition. This building program will 

be finonced by private financing, 

3. The building programs will be 

commenced on o substontially iden- 

tico! chronologlicol basis. Progress 

of the progroms will be lointly mon- 

ltored by the porties. 
4. The occupancy rote of the Gory 

tocllity will be molntoined of on 

efficient level Including urging po- 

tients opplying of the Broodway fo- 

cllity to po to the Gory focllity 

rother than be ploced on a wolting 

list. Efforts will be mode to further 

integrale the staffs ond polient cen- 

.sus of both facilities. Furthermore, 

the Hospital shall provide odeauote 

ond comparable doctors’ coverode . 

in the Emergency Room including 

the ovaliobllity of stoft speclolists 

for consultation at both siles. Addl 

tionolly the Hospital will ensure 

that oll nursing shifts ors odequate ~ 

ly covered of both focilities. Compo 

_ roble medicol education of stoff ond 

patients will be provided of both 

focilities. : ats i 

- §. Ambulotory core services will 

be exponded of The Gory tocllity 

with the OCevelopment of on eul- 

r progrom to foster utilization 

J the ombulatory core services o3 

well os the Fomlly Proctice Resh 

gency progrom. Methodist Hoseltol 

will continue to serve potlents who 

oppeor of the Emergency Room of 

Gory Methodist Hospital. Any new. 

   

ofbposed Con ~° 

Indiona, during the business 4 

~ 

- ‘odditional 

( 

   
bstelrics 
Melhodist ond centrol DI 

In porlions of Go Methodist, 
Is not precluded from requir: 

ydditional co itments ond re- 

ces from thodist Hospital 

that It requi of oll other Hospl- 

tols In Loyd County nor from re- 

quiring y loint plonning I re- 

guiregof ony other Hospitals in 

Lo County, Indiona, 
_ The Civil Rights Assuronces 

gned by Methodist Hospllc! on 

July 27, 973, ore Incorporated into 

the setflemen! agreement. 

-14. The Slote of Indiona will toke 

steps to focliitote the finoncing of 
the Gory focllity construction; will 

no! oppose any of the building pro- 

grams; ond, wlll decline 10 review 

the building projects except for the 
105 bed oddilion, under $.1172 of the 

Social Security Act. 

t 15. HEW will revise Assuronce 
Number 3 of certain Civil Rights 

Assurances signed by Ihe Hospital 
and HEW on July 27, WW73, e.jpedl- 
tiously complete Its county wide 
hospliol civil rights Review; joke 
steps to focllitote the finoncing of 

the Gary ftacility bullding proiect; 
ond, ogree tha! the building pro- 
groms outlined herein do no! consti 

te 0 violation of Title V| of the 

CN Righls Act or the July.27, 1973 

b CREE] 

Fond ipne 
   

   

    

   

  

   

   

    

   

      

   

        

CiviNRIghts Assuronces. HEW fur: 
ther obxeed nol to foke or support 
ony othelpction, odminlistrative or 

d upon olleged civil 

rights viola! which hove been 

olleped or ore thin the scope of 

the Complaints flied in the sults. 
16. The plaintifts | no! oppose 

ony of the building prodgpms. Moy- 

or Richord Gordon Ha 
moke good folth efforts to 

lighting ond se 

tprces at the Gory facility; par 
ojo 0 0 » 0 - le 

ransporiotion between the Gary 

ond Merrillville focliities; make 
avoiloble the City's powers of emi- 
nent domain to tocilitate the build- 

Ing programs; ond, provide the 

Hospital with a 2 to 3 ocre site on 
which to construct the laundry, if 

necessary. : 
If you hove any questions con 

cerning this Notice, ony of the mol. 

fers discussed In this Notice. or the 

proposed setllement or proposed 

Consent Decree, you may contfoct. 

ATTORNEYS FOR PLAINTIFFS 

Beth J. Lief.” N.A.A.C.P. Legal 
Defense Fund, 10 Columbus Circle, 

Suite 2030, New York, New York 

10019. Telephon number 212-584- 

8397, ond; 
Julian Allen, 2009 Broodway, 

Gory. Indiono 46402, Telephone 

number 219-884-1484. 

Atorneys for plaintifts ond the 

closs of oll Block residents of Gary, 

indiona. | ony Block residents of 
Gory hove ony auestions concerning 
this Notices, he or she should contact 
the ottorneys for plaintits (persons 

moy conloct Beth J. Lief by colling 

collect). 

otherwise, Dg 

   

    
   

   

  

Any other individucls having In 
quiries concerning this notice may 
contact otiorneys for the plointitts 

or the atiorneys of record listed 

below. 
ATTORNEYS FOR METHODIST 

HOSPITAL OF GARY, INC. AND 
DENIS E. RIBORDY, AS 

PRESIDENT OF THE BOARD OF 

DIRECTORS 
Bruce E. Sovers ond Edword J. 

Hussey, Hodpes, Dovls, Gruenberg, 

Compton & Sovers. 5525 Broodwuy, 

Gory. Indiano 44410. Telephone 

number 219-981-2857; 

Roymond J. Kelly, Sevfarth, 

Shaw, Folrweother & Geraoldson, 55 

Eost Monroe Street, Chicoeo, ll 

nols 60401. Telephone number 312 

344-3000 
AHorneys for defendants, Method- 

tst Hospital of Gary, Inc. ond Denls 

E. Ribordy, os President of the 

Boord of Directors. 
ATTORNEYS FOR H.EW. 

Rebecca L. Ross, Deporiment of 

Justice, 10th ond Pennsylvonlo Ave- 

nue, N.W. Washington, D.C. Tele 

phone number 202-739-210; 

Albert Homlin, Assistont Generol 

Counsel, Civil Rights Division, Of- 

er will 

    

  

     
   

   

    

  

—
—
—
 

fice of General Counsdl, Deport. . 

ment of Health, Education ond Wet 

tore, 339 Independence Avenue, 

$s. W., Washington, D.C. Telephone 

number 202-245-7731 

Jeftrey Chompoone, Attorney, Of 

fice of General Counsel, Civil Rights 

Division. Deportment of Health, Ed- 

vcotlon ond Weltore, 3X Independ- 

ence Avenue, S.W., Washington, 

. 

  

  
 



LY @ 
IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF INDIANA 

HAMMOND DIVISION 

  

BERNICE TERRY, et al 

Plaintiffs 

vs. Cause No. H 76-373 

METHODIST HOSPITAL OF GARY, INC., 

an Indiana Not For Profit 
Corporation and JOSEPH CALIFANO 
as United States Secretary of 
Health, Education and Welfare, 

- 

Defendants 

RICHARD GORDON HATCHER, 

WILLIE LEE PAGE, 

METRO CORPS OF GARY, 1INC.,, 

A Not For Profit Corporation 
and others similarly situated, 

Plaintiffs 

VS. Cause No. H 77-154 

METHODIST HOSPITAL OF GARY, INC., 

an Indiana Not For Profit 
Corporation and DENIS E. RIBORDY 
as President of the Board of 

Directors, 

JOSEPH CALIFANO as United States 
. Secretary of Health, Education 

and Welfare, 

WILLIAM T. PAYNTER, M.D., as 

State Health Commissioner for 
the Indiana State Board of 

Health, 

JAMES WHITE as Director of the 
Division of Hospital and 
Institutional Services of the 
Indiana State Board of Health, 

DAVID J. EDWARDS, M.D., as 

Director of the Health Facilities 
Services and Review Development 
Bureau of the Indiana State Board 

of Health, '’ 

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Defendants 

STATEMENT OF OBJECTIONS   

BY NORTHERN INDIANA HEALTH SYSTEMS AGENCY, INC. 
  

APPENDIX C   

  

   



® — 

In accordance with the Order of the Court entered on 

  

June 8, 1979, Northern Indiana Health Systems Agency, Inc., 

an Indiana Not-For-Profit Corporation, designated by the 

Secretary of Health, Education and Welfare of the United States 

as the Health Systems Agency serving the northern 24 counties 

of Indiana (including Lake, Porter, Newton and Jasper Counties) 

pursuant to the National Health Planning and Resources Development 

Act, Public Law 93-641 (42 U.S.C. 300 (k) et. seq.) hereby makes 

the following statement of objections in opposition to the 

proposed Consent Decree executed and filed by the parties to 

this action. 

I. INTRODUCTION 
  

The Northern Indiana Health Systems Agency, Inc. 1s one 

of more than 200 health systems agencies designated by the 

Department of Health, Education and Welfare across the United 

States to develop Health Systems Plans and Annual Implementation 

Plans which together contain detailed statements of goals 

describing a healthful environment and health systems in their 

respective areas. When developed, these plans will assure that 

quality health services will be available and accessible in a 

manner which assures continuity of care at reasonable costs for 

all residents of the health service area and which are responsive 

to the unique needs and resources of the area while taking 

into account the National Guidelines for health planning 

developed by the Secretary of HEW. These plans also describe 

objectives which will achieve said goals and set priorities 

among those goals and objectives. These functions are prescribed 

in Section 1513 (a) of the Public Health Service Act as added 

by Public Law 93-641 (42 U.S.C. §300 (1)-2). 

  

 



  
i 
! 

a a 

In addition, Subsection (f) of Section 1513 provides 

that the health systems agency shall act as the local reviewing 

entity assisting state health planning agencies in the admini- 

stration of applications for approval of capital expenditures 

under Section 1122 of the Social Security Act (42 U.S.C. $1320(a) 

-1). Under this authority, health systems agencies review 

and recommend either approval or disapproval of applications 

by health care providers for capital expenditures in excess of 

$100,000, or those involving a change in service or bed capacity 

in the case of inpaticnt facilities. 

In conducting such reviews, the health systems agency 

is required to adhere to the procedures specified in Section 1532 

Of the Public Health Service Act (42 U.S.C. §300 (n=l) which 

include, inter alia, application, notice and public hearings   

before the health systems agency adhering to criteria for review 

adopted. by the agency and containing minimums specified in 

regulations under the Social Security Act. (42 C.F.R. 100.107) 

and in the Public Health Service Act at Section 1532 ({c) (42 

U.S.C §300 (n)-1 (c))., 

As the "Notice of Proposed Settlement, Consent Decree and 

Hearing" asserts, this matter has been in protracted litigation 

for some time. Kipton Kaplan, as the Executive Director of 

Northern Indiana Health Systems Agency, Inc., was an original 

party defendant to Cause No. H 77-154 but was later dismissed 

by the Court pursuant to Motion, the Court concluding that 

disposition of the matters at issue could be achieved without 

the presence of the Health Systems Agency as a party defendant. 

The Health Systems Agency objects to the proposed Consent 

Decree in three respects: 

  

 



@ wn 

First, the construction of the additional beds 

  

< 

Sontennlaced by the Decree at Broadway Methodist Hospital 1s 

neither supported by the State Health Facilities Plan, nor 

by the Health Systems Plan adopted by Northern Indiana Health 

Systems Agency, Inc. : Both plans show a Hr SAT A surplus 

in the number of acute care hospital beds in Lake County. 

The construction of additional beds would only exacerbate 

problems resulting from the availability of too many hospital 

beds in Lake County. 

Secondly, Methodist Hospital has, as of this date, 
mr 

en serene 

adopted no long range plans governing the development of either 

Broadway Methodist Hospital nor the Methodist Hospital of Gary. 

Under these circumstances, it 1s impossible for the Health 

Systems Agency to reach a determination as to whether the pro- 

posed expansions at the two facilities are indeed appropriate 

given the Hospitals' future goals and the goals of other 

institutions serving patients in the same area. 

Third and finally, the Northern Indiana Health Systems 
“~. 
a US pr————————— 

  

Agency, Inc. objects to the Consent. Decree because it does not 

require review by either the Health Systems Agency or the State 

Health Planning Agency of any other feature of the proposed 

settlement except as to general civil rights reviews to be con- 

ducted by the Department of Health, Education and Welfare, 

In this connection, it should be kept in mind that the proposal 

of Methodist Hospital to expand which spawned this litigation 

was reviewed by the Health Systems Agency and its predecessor, 

Northwest Indiana Comprehensive Health Planning Council, Inc. 

in 1974 and again in 1976. Those two proposals vary considerably 

from the items contained in the proposed settlement. Approval 

of the settlement, therefore, will deprive the federally mandated 

health planning agencies an opportunity to comment on the appropriateness, 

  

 



  

feasibility, and ilmpact of all portions of the project on the 

  

health systems in and around Lake County, Indiana. These 

objections are detailed in the following sections of this 

Statement. 

II. CONSTRUCTION OF ADDITIONAL ACUTE HOSPITAL BEDS 

AT BROADWAY METHODIST HOSPITAL IS NOT NEEDED 
  

In reviewing proposals for the construction of additional 

hospital beds, health systems agencies are required to examine, 

among other things: 

"The relationship of the health services 
being reviewed to the applicable HSP 
[Health Systems Plan] and AIP [Annual 
Implemantation Plan]" and "the need that 
the population served or to be served 
by such services has for such services." 
Section 1532 dc) {(l and 3) Public Health 

Service Act, 42 U.S.C. §300(n)-1(c) (1-3) 
  

  

In carrying out these requirements, Northern Indiana Health 

Systems Agency, Inc. has adopted review criteria which provide 

in pertinent part, as follows: 

"The relationship of the health services 
being reviewed to the applicable NIHSA 
and State Plans. 

Whether the proposal is consistent with 

the goals, objectives and recommended 

actions of the NIHSA Health Systems Plan 

and Annual Implementation Plan. 

Whether the proposal is consistent with 

plans adopted by the Indiana State Board 

of Health and/or Indiana Department of 

Mental Health. 

Whether the proposal is consistent with 

the goals, objectives and recommended 

actions of the 'Indiana Plan for Health' 

(State Health Plan) adopted by the 

Indiana State Board of Health. 

Whether the proposal is consistent with 

the State Medical Facilities Plan when 

developed and adopted by the State Board 

of Health." 

and 

  

 



  

a — 

"The need that the population served or 
to be served has for the services to be 

offered, expanded, reduced, relocated, or 

eliminated. 

Whether need 1s determined, in the case 

of hospital or nursing home proposals 
involving beds, in accordance with the 
"Hill-Burton" formula adopted in the HSP 
and the Indiana Hospital and Health 
Facilities Plan. 

Whether the proposed project will contribute 

to the improvement of the health status of 
NIHSA residents and/or the health system 
in the NIHSA area, especially in relation 
to health problems identified in the HSP. 

Whether the proposal helps meet national, 
State and local regulations and accreditation 
standards that will improve quality of 
care and patient safety and comfort. 

Whether need is identified based on other 

applicable federal, State and local planning 
documents. 

Whether need is identified based on the 
priorities established in the State Medical 
Facilities Plan for construction, modern- 

ization, and conversion of health care 
facilities and services. 

Whether need is identified for establishment 
or expansion of specialized service consistent 
with the criteria and standards adopted 
by NIHSA and contained in the supplement 
to this Manual. 

Whether the proposed health service will 
result in improved availability and 
accessibility to the health care systen, 
with particular attention to those proposed 
services which will meet the goals and 
objectives of the NIHSA Health Systems 
Plan. 

Whether the proposal is consistent with 
needs identified in the national health 
priorities established by Public Law 93- 
641 (e.g., provision of primary care services 

for medically underserved population, 
promotion of disease prevention activities, 
promotion of activities to achieve improvements 
in the quality of health services). 

Whether the proposed service is acceptable 

and is likely to be utilized by the community 

it 1s meant to serve. 

  

 



  
Tr : 
. 

Whether need is identified based on the 
standards promulgated in The National 
Guidelines for Health Planning dated 
March 28, 1978." 

Project Review Manual, South Bend 

Northern Indiana Health Systems Agency, 
Inc., 1979, - 64.5 (1 and 3) pp. 23-25, 

  

Hence, reliance is placed on the State and Health Systems 

Agency planning documents as the primary determinant of need. 

Examination of both of those documents leads to the conclusion 

that a severe surplus of hospital beds already exists in Lake 

County and the City of Gary. 

When this 1s viewed together with the fact that the 

additional beds will not be constructed in the inner-city where 

the alleged medically underserved population is located, and 

when it 1s recognized that the present bed complement at both 

inner-city Gary Hospital facilities are already underutilized, 

no need for the proposed 105 additional beds at Broadway 

Methodist Hospital in Merrillville is evident. 

The Health Systems Plan of Northern Indiana Health Systems 

Agency, Inc. provides as one of its objectives that: 

"By 1982, the projected surplus of acute 
care hospital beds will be no greater than 
50 percent of its 1977 valde." and "By 
1982, theioverall occupancy rate (based on 
capacity beds as defined by the State 
Board of Health) of hospitals in the 24 
county NIHSA service area should be 80 
percent.” A Health Systems Plan For 
Northern Indiana Second Edition, South 
Bend, Northern Indiana Health Systems 
Agency, Inc., 1978 {page 85). 

  

  

The State Board of Health Planning Document entitled Guide To   

Indiana Acute Care, Outpatient, and Rehabilitation Centers: 
  

Inventory and Utilization Of the Existing Resources and Projected 
  

Need For Future Facilities, Beds and Services (Indianapolis, 
  

Indiana State Board of Health, May, 1978) specifies at page 12 

that the surplus of beds in Lake County as determined by the 

Bed Need Formula used by the State Board of Health projected 

to 1982 is 445 beds.? Utilization of hospital beds for 1978, 

  
  

 



  

. “YY 

the latest figures available, indicate that average occupancy 

was only ‘61.2 percent at Gary Methodist Hospital and 75.2 

percent at St. Mary Medical Center for a complement of 400 

beds and 310 beds respectively. Bed Utilization Summaries 
  

1978, (Indianapolis, Indiana Hospital Association). , 

From the foregoing, it is clear that not only will the additional 

beds not result in an improvement in service to the medically 

underserved, they will actually aggravate the impact of over-bedding 

in Gary and Lake County as a whole.? Aas a result, the Proposed 

Settlement should not include the’ construction of additional 

beds or at least be amended to permit the result of Health 

Systems Agency - State Agency review of the proposed construction 

of additional beds to be binding on the parties to the Consent Decree. 

111. NO LONG RANGE PLAN HAS BEEN ADOPTED BY THE HOSPITAL 

ESTABLISHING EITHER NEED FOR THE PROPOSED EXPANSIONS 

OR THE IMPACT OF THE PROPOSED SETTLEMENT ON THE 

HEALTH SYSTEMS OF GARY AND LAKE COUNTY, INDIANA 
  

Another criterion which the Health Systems Agency and 

State Agency must apply to the review of proposals for hospital 

expansion 1s specified at Section 1532 (c) (2) of the Public 

Health Service Act, 42 U.S.C. §300{n)-1 (c){(2) as follows: 

"The relationship of services reviewed 
to the long range development plan (if 
any) of the person providing or proposing 
such services." 

Northern Indiana Health Systems Agency, Inc. has adopted, as 

one of its review criteria, that requirement in the following form: 

"The relationship of services rendered 
to the long range development plan (if 
any) of the person providing or proposing 
such services. 

Whether the person providing or proposing 

the service has developed a long range 
plan in accordance with the NIHSA goal, 
objective and recommended actions relative 
to institutional long range plans. 

Whether the proposed service is a part of 
or 1s consistent with the applicant's own 
adopted long range plans, goals and 
objectives." Project Review Manual, South 

Bend, Northern Indiana Health Systems 
Agency, iInc., 1979,  §4.5 Page 24 

  

-8 —- 

  

 



* @ 

In addition, A Health Systems Plan for Northern Indiana, supra, 

  

  

specifies on page 75 the requirement of all hospitals in northern 

Indiana to adopt institutional long range plans as follows: 

"By July, 1979, all hospitals in northern 
Indiana should have adopted institutional 
long range plans together with a process 
for updating and revising the plan on at 
least an annual basis. Copies of insti- 
tutional long range plans should be 
submitted to NIHSA and made available 
for public review at the central office 
and appropriate subarea offices of NIHSA. 
Documents submitted to NIHSA should 
reflect the informatién detailed in the 
NIHSA Board adopted 'Criteria and 
Guidelines For Long Range Plans'. 
Long range plans should initially focus 

on the economic impact of planned 
capital expenditures." 

As of this date, neither the Methodist Hospital of 

Gary, Inc. nor Broadway Methodist Hospital have submitted 

any long range institutional plan to Northern Indiana Health 

Systems Agency, Inc. The only effort made to secure compliance 

with these requirements by the parties is the provision contained 

in paragraph (B) (18) on page 18 of the proposed "Consent Decree" 

which provides that: 

"The requirement in this paragraph is in 
addition to the hospital's responsibilities 
under 42 U.S5.C. §1320(a)-1 and Public Law 
93-641." 

As noted, compliance has yet to be achieved by the hospital 

even though the Health Systems Plan requires submission of a 

long range plan by July of this year. 

The effect of the hospital's failure to provide the 

plans in question means that it is virtually impossible to 

evaluate the impact of the proposed expansions both at the 

Methodist Hospital of Gary and at Broadway Methodist in light 

of the hospitals' projected future requirements, and in light 

of the plans of neighboring institutions. Under these circumstances, 

  

 



  

J ® 
the approval of the settlement embodied in the proposed Consent 

  

Decree in advance of the submission of the long range plans 

is tantamount to building first and planning later, a concept 

which is clearly opposed to both federal and state policy 

for the construction and expansion of health care facilities. 

IV. THE PROPOSED SETTLEMENT VARIES SUBSTANTIALLY FROM 

PREVIOUS HOSPITAL EXPANSION PLANS WHICH HAVE NOT 

BEEN SUBJECTED TO REVIEW OR APPROVAL BY FITHER 

LOCAL OR STATE PLANNING AGENCIES 
  

The proposed Consent Decree contains a number of items 

which have not been included in expansion proposals previously 

filed with the Northern Indiana Health Systems Agency, Inc., 

the State Board of Health, or the HSA's predecessor, Northwest 

Indiana Comprehensive Health Planning Council, Inc. As a result, 

major portions of the proposed settlement have never been 

examined under the criteria specified by law for review under 

the Social Security Act and Public Health Service Act. By 

circumventing the formal planning and review process, the proposed 

settlement will not be subjected to examination to determine 

financial feasibility, the impact of the proposed expansions 

and addition of services on the cost of care throughout the 

northwest Indiana region, and the appropriateness of these 

services in light of the legally adopted health systems plans. 

To dramatize the difference between the expansion project 

that was proposed in 1976 and which subsequently lead to the 

institution of this litigation (see Consent Decree pages 1l- 

4) , and the proposed settlement, the following table enumerates 

the provisions contained in the proposed settlement as compared 

£0 those contained in the 1976 project... The conclusion is self 

evident: The project has grown so large and so much more complex 

that failure to submit the entire matter or at least the new 

material contained in the project to serious review by the 

legally designated health planning authorities is clearly beyond 

the policy contemplated by federal law. 

  — 

: 

 



~ 

  

Proposed Settlement Provisions   

New Construction - Gary: 

°Medical Services Building 

£0 include Surgical Suite, 
Central ‘Supply, ICU/CCU, 
Emergency Room, and 24 
hour Pharmacy 

°Laundry 

Remodel ing/Updating - Gary: 

°Family Practive Residency 
Area 

°Power Plant 
°Nuclear Medicine 
°Obstetrics - Labor & 

Delivery 
°Auditorium 
°Parking Security 
°Ambulatory Care Clinics 
°Intermediate cardiac care 
clinic, stress testing, 
cardiac rehabilitation 
°Additional remodeling to 
comply with life Safety 
Code 

New Construction - Broadway: 

°105 beds 
°Health Services Building 

" 

Variance from 1976 Project 
  

Not included 

Included, but at Broadway 

Included, but in new construction 
Not included 
Not included 

Not included 

Not included 

Not included 

Included, but in new construction 

Not included 

Not included 

Not included 
Included, however, not all services 

to be housed in the building were 
included in 1976 proposal such as 
coffee shop, nuclear medicine 
department and auditorium. 

IV, CONCLUSION   

Should the Court choose to permit the settlement to 

be approved without resort to review pursuant to the Federal 

Health Planning Laws, it may reach a solution tc this one 

issue at the expense of worsening the turmoil in hospital 

construction in northwest Indiana. Costs of acute hospital 

stays are steadily increasing partly as the result of unneeded 

beds. New facilities and services continue to proliferate 

-11- 

  

 



nd ? 
despite the actions of the NIHSA and the State to prevent the 

  

needless duplication of these facilities and services. Approval 

of the proposed settlement without change would amount to an 

endorsement of the proposition that a near-sighted solution 

to a lawsuit will take precedence over the rational, coordinated 

and economically efficient development of hospital resources. 

Northern Indiana Health Systems Agency, Inc. urges the Court 

to permit changes in the proposed Consent Decree consistent 

with the above stated objections." 

MURPHY, McATEE, MURPHY & COSTANZA 

Attorneys For Northern Indiana 
Health Systems Agency, Inc. 

BY: Loot y/ Za 

NT 

720 W. Chicago Avenue 

East Chicago, Indiana 46312 
Telephone: 219/397-2401 

  

-12- 

  
rT ; 

i 

 



® 
NOTES 

  

  

l. On December 7, 1977, the Court ordered Kipton Kaplan ‘as 
Executive Director of Northern Indiana Health Systems Agency, 
Inc. dismissed from H 77-154 pursuant to his Motion. While 
NIHSA thus requested dismissal from participation as a party 
defendant, it did not thereby and does not now relinquish any 

of its rights or obligations under the Federal Law under which 
it was created (PL 93-641). In this connection it should be 
noted that while the Court agreed with NMIHSA'a contention that 
its presence in this action was unnecessary to dispose of the 
Civil Rights causes of action asserted against the defendant 
hospital, and since the Court apparently agreed that NIHSA's 
discretion as to these matters was limited and confined to the 

requirements of the Department of Health Education and Welfare 
regulations, the basic obligation of the agency to conduct health 
planning activities and review capital expenditure proposals 
1s undistrubed by that dismissal. Hence, any suggestion which 
may be advanced by any of the parties to this action to the 

effect that NIHSA, Inc, has waived its right to participate in 
these proceedings concerning approval of the Consent Decree is 
incorrect and inapposite. 

2. The formula used to determine and project hospital bed 

need in each county by the Indiana State Poard of Health is 
commonly known as the "Hill-Burton'” formula. This formula 
1s used widely across the United States, more than one-half of 
all health systems agencies utilizing it to determine bed need. 
The formula was recently upheld in the Arizona case of American 
Medicel International, Inc. v. State Health Planning Advisory 
Council and Health Systems Agency of Southeastern Arizona, Inc. 
No. 16°F 724, Arizona Superior Court, repruary 1, 1979. Thc 
Court in sustaining the action of the HSA and State Agency 
in denying an application for new bed construction held that: 

  

    

  

"The HB Formula actually tends to 
overestimate the needs for beds in health 
service areas (such as the one in issue) 
where use rate 1s declining and the current 
use rate is utilized as the projected use 
rate. 

The HB Formula is "logical, easily understood 
and, as applied, a tried method to calculate 
bed need which has not been proven to be 
lnaccurate. 

During 1975, 64% of the more than 200 HSAs 

throughout the nation used the HB Formula 
as a basis for their bed need projections. 
The HB Formula projects future use from 
current use and 1s subject to annual reviews 
and, in addition, to emergency reviews when 
in the best interests of the community. 
When other formulae/models are compared 

» £0 the HB Formula, it has been demonstrated 

that little additional precision can be gained. 
The use of the HB Formula as part of the 
Plan cannot have a negative impact on the 
health of local residents so long as the 
plan is reviewed on a yearly basis, although 

delay will probably increase construction 
costs. [||16b2f19e-b099-49df-a143-70852633fbe6||]